Kevin Hassett Fed Chair Emerges as Frontrunner

Kevin Hassett has emerged as the market's implied frontrunner to succeed Jerome Powell as Federal Reserve chair after a December 2025 survey found 84% of respondents expect President Donald Trump will nominate him. This development has intensified debate over central-bank policy and governance.

Survey Points to Likely Nomination Amid Preference Gap

The December survey, polling economists, fund managers, and market participants, showed a clear expectation that Trump will nominate Hassett. Yet, a majority of respondents said they would prefer a different nominee, highlighting a split between market expectations and expert preferences. Hassett, director of the National Economic Council, has gained prominence in media and market discussions as the leading candidate. Other names on the shortlist include Kevin Warsh, Christopher Waller, Michelle Bowman, and Rick Rieder. The Fed chair nomination has become the dominant leadership question for investors assessing the policy outlook.

President Trump has said the selection process is ongoing and indicated a decision is likely in January 2026, ahead of Powell’s term ending in May 2026. The White House has not yet filed a formal nomination with the Senate. The compressed timeline has increased focus on both the nominee’s identity and the policy signals they would send.

Hassett’s Policy Agenda and Market Implications

Hassett is broadly seen as supportive of lower interest rates and further monetary easing, aligning with the White House’s preference for faster cuts. He has suggested there is still room to reduce rates further, while acknowledging that rising inflation could affect that stance. Hassett has also signaled openness to organizational changes at the Federal Reserve, including staff reductions and a tighter focus on the institution’s core mandates of price stability and employment.

These positions have raised questions about potential pressures on central-bank independence and how a Hassett-led Fed might differ from Powell’s approach to balancing inflation risks against growth and employment. Markets expect the Fed to deliver a 0.25 percentage-point cut at its final 2025 meeting, the third cut of the year, though officials are likely to signal caution about further easing while inflation remains above the 2% target. Internal dissent among policymakers over additional cuts is anticipated.

Some economists aligned with the President’s economic agenda have publicly supported Hassett, arguing his views fit a growth-oriented, reform-minded approach to central-bank policy and operations.

The survey-driven expectation of Hassett’s nomination, combined with his policy leanings and the accelerated selection timeline, has focused investor attention on the pace of Federal Reserve rate cuts and the institution’s governance as the nomination and confirmation process unfolds.

Political and Market Context

President Trump has indicated that a decision on the next Fed chair is likely in January 2026, before Powell’s term ends in May. The Federal Reserve is widely expected to implement a 0.25 percentage-point rate cut at its final 2025 meeting, marking the third cut of the year, while signaling caution about further easing amid inflation above the 2% target.

The shortlist of potential candidates includes Hassett, former Fed Governor Kevin Warsh, Fed Governor Christopher Waller, Fed Vice Chair for Supervision Michelle Bowman, and BlackRock executive Rick Rieder. Trump has publicly pressured for sharper interest-rate cuts and criticized prior Fed policy as too tight, making alignment with his rate views a key factor for the next chair.

Taken together, the survey-driven expectation and Hassett’s stated policy preferences concentrate investor focus on how a new chair could influence the pace of easing and central-bank governance.