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President Donald Trump said his pick to lead the Federal Reserve can stoke the economy to grow at a rate of 15%, an exceedingly rosy target that nonetheless underscores the pressure that Kevin Warsh will face if confirmed to the role.<\/p>\n
Trump, speaking in an interview with Fox Business, said Warsh was the \u201crunner up\u201d in his last search and that it was a big mistake to pick Fed chair Jerome Powell.<\/p>\n
If Warsh \u201cdoes the job that he\u2019s capable\u201d of, then \u201cwe can grow at 15%, I think more than that,\u201d Trump told host Larry Kudlow, who was a senior aide in the president\u2019s first administration, in a clip aired Monday. \u201cI think he is going to be great, and he\u2019s a really high quality person.\u201d<\/p>\n
It was not fully clear if Trump was referring to year-over-year growth or some other metric. The US economy, which is seen expanding 2.4% this year, has grown at an average annual rate of 2.8% over the past five decades. Gross domestic product has only risen at a 15%-plus pace a few times since the 1950s, including in the third quarter of 2020 as businesses reopened following pandemic-related closures.<\/p>\n
Trump said during the search for a new chair that he wanted a candidate who would lower rates, and later said he would not have picked Warsh if he\u2019d advocated for increasing rates.<\/p>\n
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The comments make clear that Trump is betting that Warsh, if confirmed, can fuel the economy ahead of midterm elections that are historically punishing for US presidents.<\/p>\n
But Warsh\u2019s Senate confirmation may be delayed, with Senator Thom Tillis, a retiring Republican from North Carolina, pledging to block any Fed confirmation as long as Trump\u2019s administration is pursuing a Justice Department probe into Powell and a Fed building renovation project.<\/p>\n
Kudlow questioned Trump if the DOJ investigation was worth holding up Warsh\u2019s nomination.<\/p>\n
\u201cI don\u2019t know, we\u2019ll have to see what happens,\u201d Trump said. \u201cI\u2019ve been fighting Tillis for a long time, so much so that he ended up quitting.\u201d<\/p>\n
Trump, seeming unconcerned about a potential delay, added: \u201cIf it happens, it happens.\u201d<\/p>\n
Trump\u2019s comments in the Fox Business interview signal what could prove to be a high-wire act for Warsh. His remarks suggest Trump is not concerned about inflation, which would typically soar under growth rates anywhere near 15% and which has remained stubbornly elevated.<\/p>\n
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Fed officials penciled in just one interest-rate cut for 2026, according to the median estimate in projections released in December, though investors still expect two reductions this year.<\/p>\n
In a clip aired Monday, Trump said it was former Treasury Secretary Steven Mnuchin who pushed to pick Powell.<\/p>\n
\u201cMy secretary of the Treasury wanted him so badly, so badly,\u201d Trump said of Powell. \u201cAnd I didn\u2019t feel good about him, but sometimes you listen to people and it was a mistake, it was really a big mistake.\u201d Trump\u2019s full interview is due to air Tuesday.<\/p>\n
Powell was reappointed under Joe Biden but has since become a target of Trump, who has heavily pushed for lower rates and broken from decades of precedent to raise questions about the independence of the Fed.<\/p>\n
(Updates with additional details on Warsh confirmation complications in eighth paragraph.)<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
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