US President Donald Trump is expected to announce his choice for the next Federal Reserve chair in early January, Treasury Secretary Scott Bessent said, with National Economic Director Kevin Hassett and former Fed Governor Kevin Warsh emerging as the top candidates.
Bessent told Fox Business on Tuesday (December 16) that there are “one or two more interviews this week” before a decision is made. “It’s at the president’s pace,” he said. “He has been very, very deliberate,” adding that Trump has been “very direct with the candidates in the interviews in terms of asking them their views on Fed policy, Fed structure, the way forward, the economy.”
Trump signals desire to influence rates
Trump has expressed frustration with the Fed’s pace of rate cuts under current Chair Jerome Powell, whose term ends in May. He called for aggressively lowering rates.
Trump met with Warsh on December 12 and emphasized his role in advising the central bank. “It doesn’t mean — I don’t think he should do exactly what we say. But certainly we’re — I’m a smart voice and should be listened to,” Trump told WSJ.
Hassett emphasizes Fed independence
Kevin Hassett, a leading candidate, acknowledged Trump’s opinions but stressed the independence of the central bank. Speaking on CBS’ Face the Nation, Hassett said: “But in the end, the job of the Fed is to be independent and to work with the group of people that are on the Board of Governors, the FOMC, to drive a group consensus on where interest rates should be.”
Hassett added he would welcome daily discussions with the president, saying, “Even as Fed chair, I would be happy to talk with the president every day until both of us are dead because it’s so much fun to talk.”
He also clarified that Trump’s opinion would carry no formal weight in monetary decisions: “No, no, he would have no weight. It’s just, his opinion matters if it’s good, if it’s based on data.”
Fed’s recent rate cuts
The Fed lowered its benchmark rate to between 3.5% and 3.75% on December 10, marking the third consecutive reduction. The Federal Open Market Committee remains undecided on further cuts, with three officials dissenting from the latest move.
Trump’s selection of the next Fed chair will shape the central bank’s policy direction as he seeks to assert influence over US interest rates in his second term.
