Trump's Fed Chair Successor Likely Among Hassett, Warsh, or Waller as Powell's Term Ends
Federal Reserve Chair Jerome Powell's term is set to expire in May, and President Trump is expected to name his successor in the coming weeks, with Senate confirmation required.
Among the leading contenders is Kevin Hassett, a Trump loyalist and former Chair of the Council of Economic Advisers who now leads the National Economic Council. At 63, Hassett was initially considered the top contender, although his odds have declined since December amid questions about his independence and concerns over inflation.
A Deutsche Bank note highlighted that Hassett may face challenges persuading other policymakers to approve significant rate cuts due to fears that inflation will remain above target and his alignment with the administration's policies.
Kevin Warsh, a former Federal Reserve governor from 2006 to 2011, has re-emerged as a contender. Previously hawkish on monetary policy, Warsh's stance has shifted to supporting lower rates and advocating for balance-sheet reduction. He also has close ties to Trump through his father-in-law, Ronald Lauder.
Christopher Waller, a current Fed governor who recently met with Trump, is seen as a sensible choice. Although he lacks direct White House connections, Waller is viewed favorably for potential further rate cuts. Markets regard his independence from the White House as a positive factor. Trump called Waller "great" after their meeting.
Other names mentioned include Rick Reider of BlackRock and Treasury Secretary Scott Bessent as possible options.
Prediction markets showed Warsh briefly surpassing Hassett earlier in the month, while Waller has been gaining support as a viable candidate.
Overall, the credibility and independence of the Federal Reserve are perceived to be under strain amid political pressure. The ultimate judgment on the chosen Fed Chair is expected to come from Wall Street. The final decision will require Senate confirmation.
