The White House is preparing for a final round of interviews this week on candidates slated to lead the Federal Reserve, setting up a contest between White House economic adviser Kevin Hassett and two other contenders vying to replace Jay Powell as chair in May.

According to three senior administration officials speaking to the Financial Times, POTUS Donald Trump and Treasury Secretary Scott Bessent are expected to meet former Fed governor Kevin Warsh on Wednesday. 

Two additional candidates will be chosen from a pool of finalists that includes Fed governors Christopher Waller and Michelle Bowman, alongside BlackRock chief investment officer Rick Rieder, the officials said.

Hassett deemed early favorite, but not guaranteed

Hassett, who leads the National Economic Council, is supposedly the frontrunner for Powell’s seat despite concerns among some investors that he is too close to the US President and may support “unwarranted” rate cuts. 

Those fears have circulated inside the Treasury and bond desks, where economists believe cut-throat reductions could increase inflation rates and unsettle the $30 trillion Treasury market. Still, the administration insists Hassett’s selection is not guaranteed, as they plan to conduct further interviews. 

Trump’s camp also said the White House has floated the possibility of Hassett serving a shortened term as chair, though he would still need Senate confirmation.

Secretary Bessent presented a list of four names to Trump earlier this month, with Hassett and Warsh included. The remaining two slots are expected to be filled by finalists from the group of Waller, Bowman and Rieder.

Interviews are scheduled to continue into next week, with a final decision planned for early January. Officials said Trump’s chief of staff Susie Wiles may attend some of the sessions.

“Personnel decisions to be made by President Trump will be announced directly by President Trump himself. Any discussion until then is pointless speculation,” a White House spokesperson told FT.

If Hassett moves to the Fed, Bessent is expected to assume leadership of the National Economic Council in the interim while keeping his Treasury role, according to four people familiar with internal planning.

Powell has not yet decided whether he will stay on the Fed board when his chairmanship ends next May. However, Trump hinted that he has already identified a preferred candidate, telling journalists aboard Air Force One on Tuesday: “We’re going to be looking at a couple different people, but I have a pretty good idea of who I want.”

Prediction markets change after Trump’s recent Fed commentary 

President Trump, during a December 2 event at the White House, referred to Hassett as a “potential Fed chair” while greeting visitors. The former Fed governor’s odds to take Powell’s seat come 2026 on Kalshi and Polymarket jumped to 85% after the POTUS’s comments, before retreating to around 72% this week. Warsh’s odds are hovering near 13%, while Waller’s chances stand at around 5%.

Trump has spent months questioning and bashing chair Powell and the Fed to lower borrowing rates during his second term, repeating complaints that the central bank was moving too slowly. The Federal Open Market Committee cut rates in September and again in October, the first reductions of Trump’s current term. A third cut is expected on Wednesday.

Speaking at a Wall Street Journal event on Tuesday, Hassett said that while he saw room for more cuts, “the most important job” of a Fed chair was “to be looking at the economic data and to avoid being part of politics”.

Trump accuses Biden of appointing Powell through an ‘autopen’

During a speech in Mount Pocono, Pennsylvania, on Tuesday, Trump continued bashing Jerome Powell’s position by claiming he had “just heard” that all four of Biden’s Federal Reserve appointments were approved by “autopen,” implying they may not be valid.

“It could be that all four commissioners in the Fed signed by Biden … I hear that the autopen may have signed those commissions.”

Trump derisively called Powell out for acting “too late” because economist JPMorgan Chase CEO Jamie Dimon had urged the Fed chair to cut rates. “If they signed those commissions, now maybe I’m wrong, but we’re going to check,” he added.

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