Treasury Secretary Scott Bessent indicated on Tuesday that he anticipates President Donald Trump will announce the new Federal Reserve chair by the holiday season. In a CNBC interview, Bessent, who is leading the search for a successor to current Chair Jerome Powell, mentioned that he has one more interview to conduct and refrained from speculating on the candidates.
Bessent expressed optimism that an announcement would be made before Christmas but acknowledged that the ultimate decision rests with the president, stating, “But it’s his prerogative, whether it’s before the Christmas holidays or in the new year. But I think things are moving along very well.”
Trump has been a vocal critic of the Federal Reserve and has previously expressed a desire to have Powell removed, even encouraging Bessent to push for a reduction in the central bank’s key interest rate. It has been reported that the president joked about Bessent’s efforts by saying, “if you don’t get it fixed fast, I’m gonna fire your ass,” to which Bessent clarified, “If you were in the room, he was joking.”
Currently, Powell’s term is set to expire in May 2026, and he is expected to navigate a Federal Open Market Committee that is currently divided regarding the necessity of further interest rate cuts. Market expectations are leaning towards the FOMC approving a third consecutive rate cut in their upcoming December meeting.
As the search continues, Bessent is evaluating various candidates, including National Economic Council Director Kevin Hassett, former Fed Governor Kevin Warsh, BlackRock executive Rick Rieder, and current Fed Governors Christopher Waller and Michelle Bowman. Reports suggest that Hassett is the leading candidate, although the White House has dismissed rumors regarding Trump’s preferences, with spokesman Kush Desai stating, “Until an announcement is made by President Trump, discussion about Fed nominations is speculation.”
Bessent emphasized his vision for the Federal Reserve, advocating for a shift in its role to one that is less dominating than it has been since the financial crisis. He stated, “I think we’ve got to kind of simplify things. I think it’s time for the Fed just to move back into the background, like it used to do, calm things down and work for the American people.” This vision reflects a desire to recalibrate the Fed’s influence over the economy and financial markets, potentially fostering a more stable economic environment.