Sen. Elizabeth Warren (D-MA) expressed hope that the Federal Reserve will remain independent when its new chairperson begins in May.
“I have had no problem criticizing [Fed Chairman] Jerome Powell when I think he’s wrong and I’ve thought he’s been wrong a lot, but I think it’s important to have an independent Fed,” Warren said on CNBC’s Squawk Box Thursday.
“If the president just turns around and puts his own guy in there, puts in a sock puppet, then one of the consequences of that is we will lose one more part of our economy that we’ve had literally for decades,” Warren added. “And [President] Donald Trump doesn’t want that. He wants to be able to control it. So, for example, even if he’s creating tariff chaos, he wants the Fed to juice the economy. And that’s going to be a real problem.”
Powell’s term as chairman of the Fed ends in May 2026. President Barack Obama nominated Powell to serve on the Federal Reserve Board of Governors in 2012. Trump elevated Powell to chairman in 2018, and then President Joe Biden reappointed him in 2022.
Trump has regularly criticized Powell for failing to move faster on lowering the central bank’s interest rate target. He has publicly mulled firing Powell, but has kept him in the position. Trump has also hinted at making Treasury Secretary Scott Bessent the new chairman. The successor is expected to be announced before Christmas.
National Economic Council Director Kevin Hassett has also called for an independent Federal Reserve. He is now one of the contenders to become its next chairman.
On Wednesday, Powell announced that the Fed has cut its rates to target a range of 3.5% to 3.75%, down from 3.75% to 4%. Warren said she was “glad to see the Fed lower interest rates” but insisted the economy can still improve.
FED CUTS INTEREST RATE TARGET, BUT FUTURE UNCERTAIN AS TRUMP PUSHES LOOSER MONEY
“So the news yesterday, look, I’d like for it to be better news, but right now there’s still a lot of red flashing lights about this economy and the Fed’s response to it,” Warren said.
Wednesday’s announcement marked the third time this year that the Fed cut interest rates.
