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Lately, we’ve been getting questions about the gap between now and the “Next Fed.” What could it mean for the dollar, rates, gold, silver and markets?

To be clear, we’re not forecasting what will happen in President Trump’s fight against Federal Reserve Chairman Jerome Powell.

But, we have decided to game out the possibility that Powell, for whatever reason, doesn’t stay as leader of the Fed until the end.

Jerome Powell’s term as Fed Chair runs through May 2026, and he is widely expected to serve it out. But mounting pressure from President Trump, along with a rare dissent inside the FOMC, compounded by the sudden resignation of Fed Governor Adriana Kugler effective August 8, has made the question more urgent and something that investors are paying close attention to.

Even if Powell completes his term, Trump’s influence inside the Fed is growing. That’s why investors and market watchers are now weighing the possibility: what happens if Powell no longer runs the Fed? What happens if the balance of power that Powell has had within the FOMC until now goes away?

The Vacancy That Matters

Kugler’s departure opened the first Fed Board seat since Trump returned to office. He has said he intends to fill it quickly. What you should know is that appointment could do more than rebalance the Board – it could put a Trump‑aligned voice in position to shape policy immediately and build momentum toward the chair seat in 2026.

Trump has not minced words on the matter. On Truth Social, he called Powell “a stubborn MORON” and urged the Board to “assume control” if Powell won’t cut rates. At the July FOMC meeting, Trump‑appointed governors Christopher Waller and Michelle Bowman voted for a quarter‑point cut while Powell held steady at 4.25-4.50%.

These changes did not just happen by accident. It was the first time in more than thirty years that two sitting Fed governors broke with the Chair to push for easing. It was a shot across the bow.

Trump’s Shortlist and the Balance of Power

Trump’s shortlist for the new governor now centers on Kevin Hassett, Kevin Warsh and for a possible new Chair (or shadow chair), existing governor, Christopher Waller. Yet anyone he appoints could also be in the running for the appointment to be the next Fed chair.

Treasury Secretary Scott Bessent, once floated as a potential Fed leader, has also ruled himself out.

Warsh, a former Fed governor, is the hawk of the group. He has criticized both quantitative easing (QE) and the deployment of easy money policies in the past, meaning he might delay cuts, favor a stronger dollar and push for stricter balance‑sheet discipline.

Meanwhile, Hassett, the former Council of Economic Advisers chair, has long argued for a growth‑first approach, meaning quicker cuts and possibly renewed balance‑sheet expansion, or QE.

On the other hand, Waller, already on the Board, has shown his hand already by voting for cuts. If elevated, he would accelerate Trump’s agenda from the inside.

If Trump fills the Kugler seat with an ally, and Waller and Bowman remain aligned, he effectively controls three votes on the Board. That bloc could box Powell in even if he stays through 2026.

On the flip side, if Powell were to go against his current trajectory and resign early, whether from political pressure, fatigue or the desire to start the lucrative post-Fed speaking circuit sooner, Trump would gain the chance to shape the Fed outright.

Markets in Motion

If Trump‑aligned governors drive policy, the outcome is clear: faster and deeper rate cuts. That would weaken the dollar, lift gold and silver, and steepen the yield curve. Two‑year Treasury yields, now near 3.9%, could fall below 3%, while the 10‑year holds above 4.5%. Gold would rally on falling real yields and dollar weakness, while silver – with both monetary and industrial demand – could move even faster.

Equities, especially in tech and growth sectors, would welcome easier policy. But volatility could rise if markets see Fed independence at risk. After June’s weak payroll revision and Trump’s firing of Erika McEntarfer, the director of the Bureau of Labor Statistics, last week, traders raised the odds of a September cut above 60%. Gold jumped on the news, while the dollar slipped.

It was a preview of how quickly positioning could shift if Powell’s leadership wavered.

Why It Matters For You Now

For investors that are anticipating the removal or weakening of the Fed chair, a lurch toward dovish policies favoring earlier and more aggressive interest rate cuts could mean three things: long-duration bonds could become more attractive, growth stocks that rely on debt could receive a bump and a re-evaluation of currency exposures would take place pushing international assets ahead of the dollar.

Of course, if Powell remains or confidence deteriorates surrounding the Fed, further market volatility seems paramount. On Wall Street, investors could expect a sell-off in equities, with those sensitive to interest rate hikes taking the brunt of any volatility. This all signals that safe-haven assets and short-term hedges could be the trend.

Again, Powell is still in the Fed Chair role, and his term runs until May 2026. But the combination of a new Board vacancy, open dissent, and Trump’s escalating attacks makes this the moment to examine what comes next. Whether Powell serves out his term or steps aside, Trump’s influence is already altering expectations: faster cuts, a weaker dollar, stronger gold and silver, and a steeper yield curve.
 

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