Federal Reserve governor Adriana Kugler announced that she will step down next Friday, opening up a spot on the central bank's powerful seven-member board that President Trump will be able to fill. Kugler, who did not participate in the Fed's policy meeting earlier this week, would have completed her term in January. Instead, she will retire Aug. 8, the AP reports. She did not provide a reason for stepping down in her resignation letter. Kugler, who was appointed by Joe Biden in 2023, "will return to Georgetown University as a professor this fall," the Fed said in a news release. Trump has stepped up his criticism of the Fed since Chair Jerome Powell said Wednesday that the central bank would keep its short-term interest rate unchanged.
Powell also said the Fed could take months to evaluate the impact of tariffs on the economy before deciding to cut rates, as Trump has demanded. Earlier Friday, Trump called Powell a "stubborn MORON" and urged the other board members to take control. Powell's term as Fed chair expires in May next year. Axios reports that Trump's allies have been urging him to name a "shadow Fed chair"—and Kugler's resignation will allow the president to have his "hand-picked choice for the central bank in the room" as the board makes interest rate decisions in the months ahead.
- For the first time in more than 30 years, two governors dissented from Wednesday's decision, and there will likely be three dissents if the Fed holds interest rates steady again at its next meeting. The governors who dissented were the only two nominated by Trump during his first term. The remaining governors are all Biden nominees, apart from Powell, who was nominated by Barack Obama. Trump nominated him as chairman in 2018 and he was renominated by Biden.
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