Trump Says He Has Chosen the Next Federal Reserve Chair as Pressure Mounts on Powell — Here Is What This Means for Markets

• Trump says he’s chosen the next Fed chair and will announce the decision soon, with Kevin Hassett viewed as the frontrunner.
• Markets reacted quickly, expecting a more dovish direction after months of Trump attacking Powell for slow rate cuts.
• The decision comes as the Fed faces rising unemployment, delayed economic data, and internal divisions over December rate cuts.

President Trump confirmed he has made his choice for the next Federal Reserve chair, hinting that a formal announcement is coming soon as speculation intensifies around who will replace Jerome Powell. While he doesn’t plan to remove Powell before his term expires in May, Trump’s repeated criticism of the current Fed chair has already reshaped expectations across markets — and now investors are bracing for a shift in the central bank’s direction.

Trump Signals a Decision Is Imminent

Speaking aboard Air Force One on Sunday, Trump wouldn’t confirm the name, but he did little to calm the buzz surrounding frontrunner Kevin Hassett. Smiling when asked directly if Hassett was the pick, Trump simply said, “I’m not telling you — we’ll be announcing it.” The remark only heightened speculation, especially as the White House has been quietly preparing for a transition after months of frustration over Powell’s reluctance to cut rates more aggressively.

Hassett, a longtime Trump economic adviser, pushed back on the frontrunner narrative, calling it “just rumor.” Still, he acknowledged that markets clearly reacted to Trump’s comments, noting that yields dropped and a major Treasury auction saw unusually strong demand once it became clear a new chair was likely on the way.

Powell Under Fire as Rate-Cut Debate Deepens

The friction between Trump and Powell has been unusually sharp. The president has blasted Powell for months, accusing him of slowing the economy by dragging his feet on rate cuts. Trump went as far as saying he’d “love to fire his ass,” though he has repeatedly insisted he won’t remove Powell before the end of his term. Treasury Secretary Scott Bessent has already interviewed all five finalists, including Kevin Warsh, Chris Waller, Michelle Bowman and BlackRock’s Rick Rieder.

Markets increasingly expect Hassett to be the nominee, viewing him as someone Trump trusts deeply and who is aligned with the push for faster rate cuts. Reports describing him as Trump’s likely pick briefly drove the 10-year Treasury yield below 4% last week — a clear sign investors believe a more dovish policy shift is ahead.

Economic Uncertainty Makes This Choice Even More Critical

The selection comes at a delicate moment for the Federal Reserve. Inflation has eased but remains above target. Unemployment has climbed to 4.4%. And with the government shutdown delaying fresh economic data, policymakers will head into their December meeting without updated job numbers. Powell has said the Fed will move “carefully and deliberately,” a stance Trump insists is choking growth and frustrating voters facing high borrowing costs.

Trump has attacked Powell more than 40 times since April, calling him “clueless,” a “moron,” and “a golfer who can’t putt.” The next chair will inherit a divided Fed at a time when recession fears, inflation worries, and political pressure are all clashing at once.

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