The White House National Economic Council Director Hassett is seen as the frontrunner for the Federal Reserve Chair position

Kevin Hassett, the director of the White House National Economic Council, is viewed by President Trump’s advisors and allies as the top candidate for the next Federal Reserve chair. According to recent media reports, as the selection of the new Federal Reserve chair enters its final stages, Hassett's name is being mentioned the most.

Media sources cited informed individuals stating that if Hassett is chosen, Trump would place a close ally whom he knows well and trusts in the independent Federal Reserve. Outsiders believe that Hassett would bring Trump's preferred interest rate cut orientation into the Federal Reserve, which is a direction Trump has long sought to control.

However, insiders also pointed out that Trump is known for unexpected personnel and policy decisions, so nominations cannot be considered final until publicly announced. White House Press Secretary Caroline Levitt stated in a release: "No one knows what he will do until the president actually makes a decision. Stay tuned!"

Analysts suggest that these sources are likely leaking information at Trump's behest.

U.S. Treasury Secretary Scott Basset stated on Tuesday that Trump is very likely to announce the Federal Reserve chair nomination within the next month, before Christmas on December 25.

Trump himself has also hinted that a decision is nearing completion. On November 18, he stated, "I think I know who I want to choose." However, he did not disclose the specific candidate. In September of this year, Trump mentioned that Hassett, former Federal Reserve official Kevin Warsh, and current Federal Reserve Governor Christopher Waller are the top three candidates.

Historically, the nomination of the Federal Reserve chair and governors is the most direct way for a U.S. president to influence the Federal Reserve. Trump nominated the current chair Jerome Powell during his first term but later regretted it due to Powell's failure to cut rates at the pace he expected.

Hassett is considered to be highly aligned with Trump's economic views, including the belief that interest rates should be lowered. In a media interview on November 20, he stated that if he were to serve as Federal Reserve chair, he would immediately cut rates because the data indicates that we should do so. Hassett also criticized the Federal Reserve for allowing inflation to spiral out of control after the pandemic.

The Federal Reserve has long been a target of Trump's attacks. Trump has criticized Powell for cutting rates too late and has publicly stated that he considered firing him. Trump has also criticized the renovation work at the Federal Reserve's headquarters, while the White House is currently involved in legal proceedings regarding Trump's attempt to fire Federal Reserve Governor Lisa Cook.

This puts pressure on Treasury Secretary Basset. Basset is responsible for leading the selection of the next Federal Reserve chair and needs to carefully balance between candidates advocating for significant rate cuts and those who can gain the trust of the president and financial markets.

After remaining inactive for most of 2025, the Federal Reserve began cutting rates this fall, lowering the benchmark rate by 25 basis points in both September and October. However, the growing divergence among Federal Reserve officials regarding inflation and labor market prospects makes it difficult to determine whether another rate cut will occur at the next meeting in December.

Financial blog Zerohedge commented:

For a long time, it has been widely believed that Federal Reserve Governor Chris Waller is the most promising candidate, but recently his chances have declined, and market rumors suggest that Hassett is Trump's favorite Hassett's odds on Polymarket have soared to a new contract high of 50%.

The next Federal Reserve Chair is expected to be appointed for a 14-year term as a Federal Reserve Governor effective from February 1. The seat that will expire at that time is currently held by Stephen Miran, who is on unpaid leave from the White House Council of Economic Advisers. Powell's term as Federal Reserve Chair will end in May 2026, and he can serve an additional two years as a Governor on the board.

Media reports indicate that a "dovish successor" for the Federal Reserve Chair is imminent, driving U.S. stocks to intraday highs, lowering the yield on 10-year Treasury bonds, steepening the yield curve, and causing a larger decline in short-term rates:

• The yield on the U.S. 10-year Treasury bond maintained a decline of over 2 basis points, stabilizing around the daily low of 4.0018%. The yield on the 2-year Treasury bond plummeted from above 3.49% to below 3.475%, with the intraday decline expanding to 2.4 basis points, approaching the daily low of 3.4627% refreshed at 21:30 Beijing time. The 2/10 year Treasury yield spread rose sharply from a daily low of +51.223 basis points to above +53 basis points