UPDATE: President Donald Trump is poised to announce his nominee for the next Federal Reserve chair as early as the end of December. Treasury Secretary Scott Bessent revealed that an announcement could come “before Christmas,” intensifying speculation around who will replace current chair Jerome Powell.
The urgency surrounding this decision is palpable as the Federal Reserve navigates a turbulent economic landscape. Bessent stated, “I think there’s a very good chance that the president will make an announcement before Christmas,” in a recent interview with CNBC. This potential shift in leadership at the Fed could have significant implications for U.S. monetary policy and economic stability.
Leading prediction markets currently favor Fed Gov. Christopher Waller as the frontrunner to succeed Powell. Waller, who spoke positively about his recent discussions with Bessent, emphasized the need for a nominee with substantial experience. “I think they are looking for someone who has merit, experience, and knows what they are doing in the job, and I think I fit that,” Waller stated during an interview.
As of late November, Waller has overtaken Bessent’s initial favorite, Kevin Hassett, who served as director of Trump’s Council of Economic Advisors. Hassett’s earlier lead has diminished, with Waller now holding a slight edge in prediction markets on platforms like Polymarket and Kalshi.
Trump has previously stated that Hassett, Waller, and former Fed governor Kevin Warsh are among his top contenders. Warsh, who was considered for the role during Trump’s first term, has also been vocal about the need for a “regime change” at the Fed. “The specter of the miss they made on inflation, it has stuck with them,” he told CNBC in July, underscoring the critical nature of this decision.
Another notable name in the mix is Michelle Bowman, who was appointed by Trump in 2018 and reappointed in 2020. She holds significant influence, having recently voted against key interest rate decisions, highlighting her independence from conventional Fed policy.
Additionally, Rick Rieder, chief investment officer at BlackRock, has emerged as a significant contender due to his deep ties to Wall Street and extensive experience managing approximately $2.4 trillion in assets.
The pressure mounts as Powell’s term expires in May 2024, but the White House’s active search indicates a strong desire for a decision sooner rather than later. As Trump finalizes his shortlist, the potential shift in leadership at the Federal Reserve could reshape U.S. economic policy for years to come.
Stay tuned for further developments as the announcement draws nearer. The implications of this decision could resonate across financial markets and impact American households and businesses alike.
