Swiss Bank: Federal Reserve Chairman Powell to Succeed Quigley, Nomination Process Accelerated

Zhitong Financial APP has learned that according to Swiss Bank economist analysis, the unexpected resignation of Federal Reserve member Quigley last Friday will force the selection process for the next chairman to be accelerated, which may lead to a reshuffle of the leadership team at the Federal Reserve earlier than expected.

Swiss Bank economist Amanda Wilcox wrote in a report released on Friday: "The early vacancy of Quigley's seat will put the selection process for the next chairman into high gear." The Federal Reserve had previously announced that Quigley would officially leave office on August 8. This member, who was appointed in September 2023 and originally served until January 2026, missed the Federal Open Market Committee (FOMC) meeting last week due to personal reasons.

Quigley's early departure from his post is significant as it coincides with a crucial moment when the White House is finalizing plans for Powell's succession.

Wilcox said: "We had previously expected that after Quigley's term ended, Powell would be nominated to fill the vacancy. Then, in May 2026, when Powell's term ends, the person who replaces Quigley will take over as chairman."

US President Trump has openly expressed his dissatisfaction with Powell. In a background where he is concerned that Trump's tariffs policy may trigger new inflation under Biden's era, Powell has consistently resisted the government's aggressive interest rate cuts. Trump not only publicly criticized Powell for keeping interest rates high to curb economic growth but also privately discussed the possibility of firing or demoting him - an unprecedented challenge to the Federal Reserve's legal and political independence.

Swiss Bank analysis points out that since the Chairman of the Federal Reserve must be selected from among current members, Quigley's early departure provides the White House with an opportunity to arrange a successor before Powell's term ends. This helps to avoid complex situations that may arise if Powell chooses to remain in office until 2028 (when his term officially ends).

"The White House can now immediately submit nominations," Wilcox said, "but having a successor and current chairman long-term may lead to policy coordination complications and escalate the tense atmosphere within FOMC."

This tense situation has already started to manifest - there were two dissenting opinions at this week's FOMC meeting, which is the first time since 1993 that two members have voted against each other at a meeting.

As for potential successors to Powell, the media and policy circles have had numerous speculations. Wilcox notes: "Including reports by The Wall Street Journal in June, several candidates have been revealed, including Treasury Secretary Scott Benton, National Economic Council Director Kevin Hassett, and former member Kevin Wash. We think one of the two supporters who voted against a 25-basis-point rate cut last week, Vice Chairman Quarles, may also participate."

Although Swiss Bank has not made any predictions about the government's final decision, Wilcox emphasizes: "We are looking forward to following this process, especially after today's resignation event accelerated the timeline." Quigley's early departure has left the Federal Reserve with seven vacancies, and the White House is currently under intense pressure to nominate a candidate who can take over as chairman in 2026.