• Treasury Secretary Scott Bessent has compiled a five-candidate shortlist to succeed Fed Chair Jerome Powell, with a decision expected by Christmas 2025.
  • Bessent has removed himself from consideration, stating he does not want the Fed chairmanship, as President Trump pushes for a more dovish leader to accelerate rate cuts.
  • The list includes high-profile names like Kevin Hassett and BlackRock (BLK)'s Rick Rieder, sparking debates over central bank independence and Wall Street influence.

Treasury Secretary Scott Bessent has delivered a shortlist of five candidates to replace Federal Reserve Chair Jerome Powell, whose term ends in May 2026, according to people familiar with the matter. The list, reported by Fox Business and Yahoo Finance in early December 2025, includes Kevin Hassett, Director of the National Economic Council; Rick Rieder, BlackRock's Chief Investment Officer of Global Fixed Income; Kevin Warsh, former Fed Governor; Christopher Waller, current Fed Governor; and Michelle Bowman, current Fed Vice Chair for Supervision. Bessent is expected to present this list to President Donald Trump shortly after Thanksgiving, with a nomination anticipated by year-end.

Bessent has explicitly ruled himself out of the running, telling associates he does not want the Fed job, a move that clarifies earlier mischaracterizations suggesting otherwise. This development comes as Trump has ramped up criticism of Powell, calling him a "stubborn moron" and "Jerome Too Late Powell" for not cutting interest rates aggressively enough. The president has signaled he wants a new chair who will pursue faster, deeper rate cuts to boost economic growth, despite inflation hovering around 3% year-over-year, above the Fed's 2% target.

Efforts to restructure the Fed's leadership have hit a snag amid concerns over political influence. Bessent, who earlier proposed an early confirmation to reduce Powell's remaining sway, later walked back that idea after facing backlash about politicizing the central bank. In a recent statement, he emphasized the need for regulatory stability, but his active role in shaping the shortlist has drawn scrutiny from economists and market watchers alike. Without a deal that balances independence with administration priorities, the Fed could face heightened volatility and credibility risks.

Rick Rieder's inclusion on the list has particularly ignited debate over the "revolving door" between Wall Street and central banking. As BlackRock's fixed-income chief, Rieder oversees strategies involving trillions in assets, and his potential nomination raises questions about conflicts of interest. In a recent interview, he expressed deep respect for the Fed's role in helping people through monetary policy, but has not formally declared interest. Attempts to reach Rieder for further comment were unsuccessful, though sources close to him say he is focused on his current responsibilities at BlackRock, where CEO Larry Fink is planning a transition for 2026.

Market reactions have been muted so far, with the S&P 500 trading flat and Treasury yields holding steady in early December sessions. However, analysts warn that a more dovish Fed chair could spur short-term rallies in equities and bonds, while increasing long-term inflation risks. Fed Governor Christopher Waller, another candidate, has publicly advocated for a rate cut as soon as December 2025, citing labor market softness, positioning himself as a serious contender who aligns with Trump's desires for faster easing.

As the nomination process unfolds, stakeholders from consumers to investors are weighing the implications. Lower rates might reduce borrowing costs for mortgages and credit cards, but could fuel inflation if the economy overheats. Meanwhile, international relations hang in the balance: a weaker dollar from dovish policies might affect trade flows, especially amid tensions with China and Russia, where Bessent has pushed for tougher economic measures. The outcome will likely set precedents for Fed governance, with some experts calling for reforms to insulate future chairs from political pressures.

Correction: An earlier version of this article misstated the timing of Bessent's list delivery; it is expected after Thanksgiving, not immediately. The Fed's next policy meeting is scheduled for mid-December, where rate decisions may further influence the chair selection dynamics.