Final interviews begin for Fed chair candidates…Kevin Hassett among shortlist under review

President Donald Trump has begun interview procedures for the final group of candidates, including White House economic adviser Kevin Hassett, to select a successor to Jerome Powell, whose term as chair of the U.S. Federal Reserve (Fed) ends in May next year.

On the 9th (local time), according to the Financial Times (FT), President Trump and Treasury Secretary Scott Bessent are scheduled to interview former Fed governor Kevin Warsh on the 11th, and despite observations that Hassett remains a leading contender, the trend of expanding the candidate pool continues. Internal sources said the White House is still considering Fed governors Christopher Waller and Michelle Bowman, and Rick Rieder of BlackRock, among others, as candidates.

On Air Force One, President Trump told reporters, "I'm seeing a few more people, but I have a sense of who I want." He had shown a favorable stance toward Hassett until recently, but the additional interview procedures have diluted the sense of certainty.

The FT reported that some Wall Street investors worry that Hassett is too close to the president and may lean toward interest rate cuts. In the market, despite Hassett's recent remarks emphasizing the Fed's independence, there remains concern that "excessive stimulus could increase volatility in the government bond market." At a Wall Street Journal event the previous day, Hassett emphasized, "The most important duty of the Fed chair is independence from politics," and "data-driven judgment is important."

Along with discussions on appointing a successor, attention is also focused on Secretary Bessent's future role. Multiple officials said that if Hassett becomes Fed chair, Bessent might concurrently serve as head of the National Economic Council (NEC) for the time being. President Trump has repeatedly stated that "he wants to appoint Bessent as Fed chair," so a scenario is also being discussed in which Hassett serves a shortened term and Bessent later moves into the role.

This appointment process is taking place at a time when a third consecutive Fed rate cut is expected. The market sees a high probability that the federal funds rate will be lowered to 3.5%~3.75% at the Federal Open Market Committee (FOMC) meeting on the 11th (local time). President Trump has repeatedly said, "We have to lower interest rates to 1%," and the selection of the next chair is expected to have a significant impact on the direction of U.S. monetary policy.