US President Donald Trump said on Sunday that he has chosen his pick for the next Federal Reserve chair, after repeatedly saying he wants someone who will push for interest-rate cuts. “I know who I am going to pick,” Trump told reporters on Air Force One as he flew back to Washington, although he did not reveal any names, saying, “We’ll be announcing it.”
Trump has often criticised current Fed chair Jerome Powell for not cutting rates quickly enough. Sources told Bloomberg News last week that Kevin Hassett, the head of the White House National Economic Council and Trump’s top economic adviser, is widely seen as the frontrunner to replace Powell.
Is Kevin Hassett Trump’s Fed Chair pick?
Hassett, during an interview on CBS’ Face the Nation earlier on Sunday, avoided saying whether he believes he is the leading contender to replace Jerome Powell. He dismissed the speculation as nothing more than a rumour. At the same time, he pointed to the positive reaction in financial markets after reports suggested that Trump was close to choosing his nominee, a way of pushing back against worries that investors might think he is too closely linked to the president.
He explained that the Treasury auction had gone well and interest rates had fallen, adding that Americans could expect Trump to pick someone who would work to make car loans cheaper and make it easier for people to get home loans at lower rates. He said the market’s response to the rumour about him showed this clearly.
The Bloomberg report, citing people familiar with the matter, said that Trump trusts Hassett and believes they share the same approach on pushing for sharper interest-rate cuts by the Federal Reserve. Hassett has indicated that he would take the job if offered. But analysts caution that he may find it hard to bring the Fed’s rate-setting committee together and could face stronger pressure from Trump. His focus on how markets reacted was seen as his way of answering those doubts.
Trump is known for changing his mind until the last moment, but even the possibility of Hassett being nominated caused the yield on the 10-year Treasury to briefly fall below 4%.
Trump likely to reveal nominee before Christmas
Treasury Secretary Scott Bessent, who is handling the selection process, said last week that Trump may reveal his nominee before Christmas.
Apart from Hassett, others still in the running include Fed governors Christopher Waller and Michelle Bowman, former Fed governor Kevin Warsh, and BlackRock’s Rick Rieder. Trump also often mentions that he would like Bessent to take the job, though Bessent has repeatedly turned down the idea.
Whoever Trump chooses will need Senate approval, both for the role of chair and, if the nominee is someone from outside the Fed, for a 14-year term as a Fed governor starting in February. Powell’s term as chair ends in May.
