• Kevin Hassett, current head of the National Economic Council, is "honored" to be on the short list to replace Jerome Powell as Federal Reserve Chair under Donald Trump, with betting markets and political observers seeing him as the frontrunner.
  • Hassett has argued for immediate interest rate cuts and framed Trump's second-term economic agenda as poised to deliver a "blockbuster" year for growth in 2026, aligning closely with Trump's criticism of the Fed.
  • Economists are split: supporters describe him as a "hard money" economist with strong credentials, while critics warn his appointment could weaken Fed independence, politicize monetary policy, and undermine trust in federal data.

A Potential Shift at the Fed

Kevin Hassett has publicly acknowledged he is "honored" to be considered for the role of Federal Reserve Chair, as speculation intensifies that Donald Trump will nominate him to replace Jerome Powell. According to people familiar with the matter, the White House is signaling a decision and announcement around Christmas, with prediction markets now leaning heavily toward Hassett's selection. In recent media appearances, he has positioned himself as an advocate for aggressive monetary easing, stating that if he were running the Fed today, he would cut interest rates immediately. This stance dovetails with Trump's long-standing complaints that the central bank has been "late" on rate cuts and put "politics ahead of their mandate."

Hassett's rise reflects a broader shift within Trump's economic circle toward advisers who publicly echo the former president's skepticism of federal institutions. He has not shied away from controversial positions, questioning the integrity of official jobs data after Trump fired the Bureau of Labor Statistics commissioner and alleging "rigged" numbers. Some veteran Fed watchers, cited anonymously in financial reports, see warning signs in bond markets, where pricing suggests an elevated inflation risk premium tied to fears about political pressure on the central bank. One economist warned that undermining trust in federal data is "highly dangerous" because financial markets depend heavily on those releases.

Inside Trump's orbit, concerns about Hassett's political loyalty are dismissed as establishment anxiety. Allies like Stephen Moore argue he is exactly the kind of Fed chair needed to prioritize low inflation and support Trump's industrial policy. Hassett has suggested that cost overruns in renovating the Fed's Eccles Building could constitute "cause" for removing Powell, a legal justification Trump has long sought. His background adds complexity: before his current role, he was viewed as a mainstream conservative economist, with bipartisan support for his 2017 nomination to chair the Council of Economic Advisers, including endorsements from former Fed chairs Alan Greenspan and Ben Bernanke.

Market reactions have been muted but attentive, with traders monitoring any confirmation of his nomination for potential volatility in bond yields and the dollar. In the short term, analysts expect continued pricing of political risk around the Fed. If appointed, Hassett's push for near-term rate cuts and alignment with Trump's agenda could lead to more uncertainty about the inflation path and possible tensions with international investors. The situation draws comparisons to historical precedents, such as Nixon's pressure on Arthur Burns in the early 1970s, often cited as a cautionary tale about politically driven monetary policy. Efforts to reach Hassett for additional comment were unsuccessful, but his public statements have made his intentions clear: to steer the Fed toward a more accommodative stance while championing Trump's economic vision.