Trump Attacks 'Hostile' Fed, Eyes Cook Removal and Warsh Role
Trump escalated his Fed feud, signaling Warsh has rate-cut latitude and confirming plans to oust governor Lisa Cook.
Donald Trump is turning up the heat on the Federal Reserve — again. In a fresh interview, the former and current president called the Fed "hostile" and made clear he's not backing down from his campaign to reshape the central bank in his image. If you're trading rate-sensitive assets, pay attention.
Trump specifically said Kevin Warsh "has to do what he has to do" on interest rates — a phrase that sounds casual but carries weight. Warsh, widely seen as a top contender for Fed Chair when Jerome Powell's term expires, is now being given what amounts to a public green light. Trump is essentially signaling the market that his preferred Fed chief would move on rates — and the implication is: down.
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The bigger bombshell for institutional watchers is Trump's confirmation that he still plans to remove Fed governor Lisa Cook from the board. Cook was appointed by Biden, and Trump has made no secret that he views the current Fed composition as an obstacle. Removing a sitting governor would be legally contested territory — the Fed's independence is baked into its statute — but Trump appears undeterred. That's a headline risk you can't ignore if you're long Treasuries or short volatility.
For traders, the calculus here is straightforward: more political pressure on the Fed historically spooks bond markets and can briefly lift gold. But if markets start pricing in a genuinely more dovish Fed under Warsh, you could see the rate-cut trade accelerate ahead of any actual policy shift. Watch the 2-year yield and Fed funds futures for real-time conviction signals.
This story is moving fast and the legal and political fallout from a potential Cook removal could reshape the Fed power structure heading into 2026. Continue reading at MarketWatch.com.
