(CTN News) – In the coming days, President Donald Trump plans to appoint people to fill two important positions: one to the Federal Reserve and another to take over as director of the Bureau of Labor Statistics.

Both positions become open on Friday. The unexpected departure of Governor Adriana Kugler created a vacancy in the Federal Reserve job, while President Trump’s unexpected removal of Erika McEntarfer, commissioner of the Bureau of Labor Statistics, created a vacancy in the other position.

Trump revealed he’s considering replacing McEnterfer.

In reference to the Kugler position, Trump said, “I have several candidates in consideration.” My chances of making the announcement in the coming days are rather high.

Kugler has decided to leave the Federal Reserve before her term ends, even though her tenure is set to expire in January of the following year.

Kugler wrote a letter to Trump on Friday, but he did not explain the decision, which would take effect August 8. During his time as Federal Reserve governor, Kugler was a permanent member of the Federal Open Market Committee.

This committee is responsible for setting the central bank’s primary funds rate, which serves as a benchmark for interest rates across the US economy. Furthermore, governors participate in the creation of financial regulations.

Kugler typically backed the policies of Chair Jerome Powell, who has frequently faced criticism from Trump, throughout her brief term, which lasted less than two years.

President Trump has stated that he will evaluate prospective Federal Reserve nominees based on their willingness to support a reduction in the funds rate.

This “Trumpification” of the Fed is accelerated by Kugler’s retirement, according to Krishna Guha, head of global policy and central bank strategy at Evercore ISI. This retirement allows President Trump to appoint a potential successor to Powell as the head of the Federal Reserve.

Potential successors include former Federal Reserve Governor Kevin Warsh, Assistant Secretary of the Treasury Scott Besent, and National Economic Council Director Kevin Hassett.

Disputation over employment statistics

Trump dismissed McEnearney due to unsatisfactory nonfarm payroll data released on Friday. The economy only added 73,000 jobs in July, according to the Bureau of Labor Statistics (BLS), which reduces the total for the previous two months by 258,000.

In a Sunday post on Truth Social, President Trump accused McEnterfer of making “the most significant miscalculation in over 50 years.”

The Bureau of Labor Statistics (BLS) frequently modifies the monthly employment estimates as it receives more information from the establishment survey that is utilized to calculate the nonfarm payroll statistics. However, the number of survey replies has declined over time, leading to an increase in modifications.

The Bureau of Labor Statistics (BLS), for instance, lowered their estimate for the 12-month period ending in March 2024 by 818,000 from the year before.

“I think it is essential to get a fresh viewpoint in order to update the labor data, since it needs to be trustworthy and transparent.” According to Hassett, “It must be something on which the market can place substantial wagers,” on Monday’s CNBC. “It must be…”

McEnterfer’s termination has been the subject of intense criticism due to worries that it could politicize the Bureau of Labor Statistics. These figures are used as indicators of several economic variables and to set policy.

“The risk of politicizing the data collection process must not be disregarded,” said Michael Feroli, the head U.S. economist at JPMorgan Chase, in response to the heated discussion surrounding the Fed’s possible politicization in recent months.

Using the soft landing analogy, we can say that a malfunctioning instrument panel can be as dangerous as a pilot with servile prejudice. Regarding McEnterfer’s possible replacement, President Trump has not made any public remarks. William Wiatrowski, currently serving as deputy commissioner, is conducting an investigation.

SOURCE: CNBC