• President Trump is likely to announce his pick for Federal Reserve Chair before Christmas, accelerating a leadership change at the central bank.
  • The move follows escalating tensions with current Chair Jerome Powell over interest rate policy, with Trump pushing for aggressive cuts.
  • Treasury Secretary Scott Bessent is leading the candidate search, with Fed Governor Christopher Waller reportedly on the shortlist.

President Donald Trump is expected to name his choice for the next Federal Reserve Chair before Christmas, according to people familiar with the matter, setting the stage for a dramatic shift in U.S. monetary policy early next year.

The accelerated timeline, confirmed by Treasury Secretary Scott Bessent in recent comments, comes amid a protracted public campaign by Trump to pressure the central bank for substantial interest rate cuts. The President has repeatedly criticized current Chair Jerome Powell's reluctance to pursue the aggressive easing he desires, creating one of the most significant rifts between a White House and the Fed in decades.

Trump's administration has already begun a formal process to select Powell's successor, with Bessent interviewing candidates for the position. While the White House has not officially confirmed its shortlist, Fed Governor Christopher Waller is among those under serious consideration, according to two people briefed on the discussions.

Efforts to restructure the Fed's leadership have hit several procedural and legal hurdles in recent months. Trump's extraordinary attempts to remove current board member Lisa Cook have sparked legal challenges and public debate, breaking with long-standing traditions around central bank independence. A White House spokesperson did not immediately respond to a request for comment on the timing of the announcement.

The leadership transition comes at a delicate moment for monetary policy. The Fed has held its benchmark rate steady between 4.25% and 4.5% for much of 2025, following a period of rapid tightening to combat post-pandemic inflation. Trump has called for cuts totaling 3 percentage points—far exceeding market expectations and mainstream economic advice—raising concerns among some economists about potential inflation risks.

The composition of the Fed board is in considerable flux, contributing to market uncertainty ahead of key policy decisions. The recent early retirement of board member Adriana Kugler allowed Trump to appoint Stephen Miran, whose confirmation was pushed through the Senate at unusually high speed. Miran will serve for just four months but could influence critical monetary decisions during the transition period.

Without a new Chair aligned with the administration's views, Trump would face continued resistance to his preferred monetary policy direction. The President appointed Powell originally in 2017, but their relationship has soured dramatically as Trump now seeks a more compliant successor who will implement his vision for substantially lower interest rates.

Market participants are watching the developments closely, with some analysts warning that political pressure on the Fed could undermine its credibility and lead to longer-term economic instability. The timing of the expected pre-Christmas announcement suggests the administration wants to minimize market uncertainty during the holiday period while signaling a clear direction for monetary policy in the new year.