Financial markets suddenly have a new obsession — not the next rate cut, but who will be sitting in the Federal Reserve’s top chair when the next phase of U.S. monetary policy begins. The drama isn’t coming from the Fed itself, but from the Oval Office.
Key Takeaways:
Trump has started interviewing candidates and hinted that he already knows who he wants to replace Powell.
Prediction markets show Kevin Hassett with a commanding 47% probability of becoming the next Fed chair.
Hassett favors a deeper rate cut, making the December FOMC meeting the next major inflection point.
President Donald Trump has openly acknowledged that interviews for the next Fed chair are already underway, even though Jerome Powell’s term has months left. And instead of playing coy, Trump suggested that he has already settled on the candidate he wants — without saying who it is.
The message was delivered casually, almost offhand, during a diplomatic meeting with Saudi Arabia’s Crown Prince. It was enough to ignite speculation instantly across prediction markets and crypto trading platforms, where users bet real money on political outcomes.
New Narrative: The Fed Chair Race Moves Out of the Shadows and Into the Betting Arena
Once Trump hinted that the decision is basically made, one candidate moved sharply ahead in the prediction markets: National Economic Adviser Kevin Hassett.
On Polymarket — a platform notorious for turning political rumors into real-time probability charts — Hassett now holds a 47% chance of becoming the next Fed chair, towering over every other contender. Christopher Waller trails with 21% odds, while Rick Rieder and Kevin Warsh sit near 11% each.
It helps that Hassett has been anything but shy. He has already said publicly that he would accept the job if asked, while also emphasizing his experience inside the Fed earlier in his career. In other words, Hassett is not campaigning — but he’s definitely not hiding.
The Powell Complication
Jerome Powell’s term doesn’t end until May 2026, but that timing is no longer central to the story. A more immediate pathway is available: Stephen Miran’s Fed governor term expires in January. The president could nominate a successor for that seat, then elevate that governor to chair once Powell’s term ends.
People close to the situation expect Trump to take that two-step route — a slow motion exit rather than a sudden firing.
Powell, meanwhile, remains the target of a long-running presidential grievance. Trump has repeatedly attacked Powell this year for refusing to cut rates earlier, only softening slightly after the Fed delivered two rate cuts in September and October. Even then, Trump framed the move as the Fed belatedly correcting “interest rate stupidity.”
The December Rate Decision Becomes a Test Case
The leadership drama now collides with monetary policy. Hassett has made it clear that — in his ideal world — the Fed would be more aggressive in easing. He believes a larger cut is justified in December, even though he expects policymakers to stick to a 25-bps reduction if they cut at all.
Other Fed officials have warned that lowering rates too quickly risks reigniting inflation, turning the December meeting into both a policy event and a political pressure point.
The race for the Fed chair has become a proxy for a much larger divide: Should the central bank guide the next economic phase cautiously, or should it push aggressively for cheaper borrowing?
Kevin Hassett represents the latter philosophy. And right now, markets are behaving as though he is the future.
