Trump wants new Fed chair to be 'totally independent'

Donald Trump urged the incoming Federal Reserve Chairman Kevin Warsh to be "totally independent" at a White House swearing in ceremony on Friday.

The US president, who repeatedly and publicly clashed with Warsh's predecessor Jerome Powell, said he wants his latest pick to ignore outside opinions.

"I really mean this, I want Kevin to be totally independent. Don't look at me, don't look at anybody, just do your own thing and do a great job, okay," he said.

Critics of Warsh's appointment, including senior Democrat Senator Elizabeth Warren, had warned he would be little more than a "sock puppet" for President Trump.

Trump's decision to host the ceremony at the White House - the first time the building has been used to swear in a Fed chair since Alan Greenspan in 1987 - shows the president's investment in Warsh's appointment.

In the run-up to Warsh's appointment, he repeatedly called on Powell and the central bank to cut interest rates in a bid to boost economic growth.

And he said support for an immediate reduction in US borrowing costs would be a requirement for anyone to be considered for the job.

However, the central bank has defied Trump and delayed expected rate cuts as it weighs the impact of the US-Israel war in Iran on inflation.

The Fed's rate was held at between 3.5% and 3.75% in April, and economists now expect it to be kept there for the rest of 2026, with some even forecasting an increase.

Higher interest rates make borrowing more expensive for everyday consumers, which helps cool down inflation by slowing spending.

As well as urging Warsh to uphold the Fed's independence, he hit back at critics of his appointments and said "no one in America is better prepared" to lead the bank.

He called for Warsh to let the economy "boom" during his tenure, and said the central bank had "lost its way" under Powell's leadership.

He said it had become distracted by issues unrelated to its core purposes of stable prices, low inflation and full employment, straying into areas such as climate change and diversity, equity and inclusion (DEI).

Warsh, a former Wall Street banker, faces a delicate balancing act. He faces the challenge of a deeply fractured economic landscape while convincing skeptical politicians and the public that he can keep the institution entirely free from White House interference.

He vowed on Friday to lead a "reform-oriented" Federal Reserve, telling Trump he believed "these years can bring unmatched prosperity that will raise living standards for Americans from all walks of life".