President Donald Trump's latest picks to serve on the FederalReserve Board will challenge the long-standing notion that there isa trade-off between low unemployment and higher inflation,according to his chief economic adviser.

Trump last week said he intends to nominate Judy Shelton and St.Louis Fed research director Christopher Waller to serve on theFed's Board of Governors. Shelton's previous views on the goldstandard and her doubts about the central bank's mandates fromCongress to pursue stable prices and maximum employment have raisedconcerns among economists. She called the mandate “nebulousobjectives” in an interview with Bloomberg in May.

“We are challenging the Phillips Curve status quo,” LawrenceKudlow, National Economic Council director, told reporters Tuesday.“You betcha. I mean, I spent my whole career on that, and thepresident agrees with this, of course he agrees with this, soJudy's going to be a leader on that and so will Waller.”

Trump announced on Twitter last week that he was advancingShelton and Waller as his picks for the two open seats on the Fedboard. Kudlow said both candidates met with the president for about45 minutes. “It was kind of cool,” he said. “This president is veryengaged on monetary policy. He knows a lot.”

After the president made his decision on the two nominees,Kudlow said he called Mike Crapo, the Republican senator from Idahowho leads the Senate Banking Committee, which confirms Fednominees.

Kudlow weighed in on the Fed's mandate in an earlier interviewat a CNBC event in Washington, saying: “Price level stability and asteady dollar is what the Fed should aim for, not employment.”

He also said that Fed Chairman Jerome Powell's job is safe fornow. “There is no effort to remove him. I will say thatunequivocally at the present time,” he said. “There are no planspresently to change Powell's job.”

Trump has repeatedly blasted Powell over the Fed's interest rateincreases last year and complained about the strength of thedollar. He's said he has the authority to replace Powell as Fedchairman but doesn't plan to do it.

White House aide Kellyanne Conway echoed the point Tuesday,saying: “He has the power to fire Jay Powell, but he hasn't donethat; he's not doing that.” Powell has said he intends to serve hisfull four-year term and that “the law is clear” on that issue.

Trump's eagerness to get rid of Powell makes Shelton and Wallerpotential chairs-in-waiting, if confirmed by the Senate for seatson the board. The lengthy Senate confirmation process means neithercandidate is likely to join the board for months.

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