President Donald Trump will begin the final interviews of candidates for the Federal Reserve chair this week, putting back on track the formal selection process that began this summer.
“We’re going to be looking at a couple different people, but I have a pretty good idea of who I want,” Trump said Tuesday night aboard Air Force One to reporters.
The interviews by Trump and Treasury Secretary Scott Bessent will begin with former Fed Governor Kevin Warsh on Wednesday and also include Kevin Hassett, the director of the National Economic Council, at some point, according to two sources. It restarts the process that was derailed a bit last week when interviews with candidates were abruptly canceled.
Kevin Hassett, director of the National Economic Council (L), and Kevin Warsh, former governor of the U.S. Federal Reserve.
Reuters
Trump said recently he knew who he was going to pick to succeed current Chair Jerome Powell, and prediction markets overwhelmingly believed it would be Hassett. But his possible selection received some pushback from the markets recently, especially among fixed income investors concerned Hassett would only do Trump’s bidding and keep rates too low even if inflation snaps back.
So it’s unclear if these interviews are a sign Trump has changed his mind or just the final stage of the formal process.
CNBC first reported in October that Trump had narrowed the candidate list down to five people. Four of those five will be part of these final interviews. The group also includes current Governors Christopher Waller and Michelle Bowman as well as BlackRock fixed income chief Rick Rieder.
The Fed will likely lower rates for a third time this year on Wednesday, but Powell, whose term as chair is up in May, is expected to strike a cautious tone at his post-meeting news conference on how much lower the central bank will go next year. The Fed’s latest forecast released in September called for just one cut next year.
A hawkish tone from Powell on Wednesday could further frustrate Trump, who is trying to remake the Fed in a way the favors a lower-rate regime. Trump reiterated in a Politico interview posted Tuesday that he will litmus test the candidates on their willingness to cut rates further.
Warsh declined to comment to CNBC.
