Fed resignation gave opening for Trump amid precarious time for central bank: WSJ

President Trump recently nominated Stephen Miran, head of the Council of Economic Advisers, to fill a vacancy on the Federal Reserve, bringing a loyalist into the central bank. The opportunity arose unexpectedly when Fed governor Adriana Kugler resigned six months ahead of her term's end.

Kugler, appointed by President Biden, didn’t provide a reason for her early departure, though she missed a recent rate-setting meeting due to a "personal matter." The Fed confirmed that Kugler would return to Georgetown University, where she was a faculty member before joining the board, The Wall Street Journal reported on Saturday.

While it’s not uncommon for Fed governors to leave before their terms expire, Kugler’s resignation surprised many as she had been involved in ongoing discussions on central bank matters expected to continue into January.

Her departure comes at a critical time for the Fed, with Chair Jerome Powell under intense pressure from Trump to lower interest rates. Powell also faces a divided board over whether to cut rates amid ongoing inflation concerns and a cooling labor market. Kugler had recently supported holding rates steady.

During her nearly two years at the Fed, Kugler was known for her technical expertise on economic data and labor market trends. She was the first Hispanic member of the Fed's board and conducted interviews in Spanish.

Kugler had previously disclosed financial transactions that violated the Fed’s strengthened personal trading policies. She admitted her husband had made stock purchases in Apple (AAPL) and Cava Group (CAVA) during blackout periods, though she claimed the transactions were unintentional. Upon learning of the purchases, Kugler promptly informed ethics officers and divested the stocks, following Fed rules.

These violations came after Powell introduced stricter financial rules for top Fed officials in 2022, following controversy over the trading activities of two Fed presidents in 2021.

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