As global financial markets remain highly sensitive to the Federal Reserve's monetary policy direction, U.S. President Donald Trump has once again dropped a bombshell. On December 1, 2025, Trump stated, "I know who I want to be the Fed chair, and I will announce it soon." This remark immediately sparked widespread speculation in the market regarding the future leadership of the Federal Reserve and its monetary policy direction. Previously, Kevin Hassett, the director of the White House National Economic Council, had been seen as the most likely candidate for the position. Amid rumors circulating in the market about Fed Chair Powell possibly resigning and the complex backdrop of rising expectations for a rate cut in December, Trump's statement will undoubtedly bring new uncertainty and volatility to the financial markets.
- Trump announces he has decided on the Fed chair candidate: Powell's future remains a mystery
On December 1, 2025, President Trump publicly stated that he has decided on the Fed chair candidate and will "announce it soon."
Breaking with tradition: This move breaks the usual practice of appointing a Fed chair, where the White House typically announces a new chair candidate three to four months before the current chair's term ends. Trump's early announcement aims to guide market expectations regarding future interest rate paths and exert influence on the Fed's current decisions.
Powell's future: Current Fed Chair Powell's term will end in May next year. Previously, there were rumors in overseas markets suggesting that Powell would announce his resignation during an emergency meeting scheduled for 7 PM Eastern Time on Monday. However, this "rumor" has not been reported by mainstream media, nor has there been any evidence from official channels or the Fed itself to support it.
Powell's speech: This Tuesday at 9:00 AM, Fed Chair Powell will deliver a speech at a commemorative event, with the specific topic of the speech yet to be disclosed.
- Kevin Hassett emerges as a popular candidate: Close relationship with Trump
Kevin Hassett, the director of the White House National Economic Council, has been viewed as a leading candidate in the selection of the Fed chair.
Hassett's positive response: On November 30, Hassett stated that if President Trump nominated him to be the Fed chair, he "would be very willing to serve."
Praise for Trump: Previously, Hassett praised the market's positive reaction to the possibility of Trump nominating the next Fed chair before the end of the year, further strengthening his close relationship with Trump.
"Rumors" and speculation: When Hassett appeared on CBS's "Face the Nation" last Sunday, he declined to comment on whether he was the frontrunner to succeed Fed Chair Powell, but referred to related reports from Bloomberg as "rumors."
- Expectations for a Fed rate cut in December heat up: Market pricing has fully reflected this
As the selection of the Fed chair remains undecided, market expectations for a Fed rate cut in December continue to rise.
Goldman Sachs analysis: On November 30, Wall Street Journal reported that analysts from Goldman Sachs' Fixed Income, Currency, and Commodities (FICC) division believe that a rate cut at the upcoming December meeting has essentially become a foregone conclusion. Analysts pointed out that given the weak trends in the labor market and risk management needs, a rate cut at this time is the correct policy choice, and market pricing has fully reflected this expectation.
Sufficient support votes: Goldman Sachs analysts believe that comments made by Williams last Friday indicate that there are already enough support votes within the Federal Open Market Committee (FOMC) to push for a rate cut.
Rate cut probability as high as 85%: As a result, market pricing has rebounded to 21 basis points. With the Fed officially entering its quiet period, the probability of a rate cut reflected in market pricing has reached as high as 85%.
- Bitcoin plummets at opening: Market reacts to uncertainty
Despite rising expectations for a Fed rate cut, Bitcoin opened sharply lower this week, indicating market unease regarding the uncertainty surrounding the Fed's leadership.
Bitcoin's sharp drop: On December 1, it was around $86,200.
Market predictions: The probability of "Bitcoin rising to $100,000 again this year" on Polymarket has dropped to 32%, having touched 45% over the weekend.
Conclusion:
Trump's announcement of having decided on the Fed chair candidate, with Hassett emerging as a popular choice, has created uncertainty regarding the Fed's leadership and monetary policy direction. In a context where the market generally expects a rate cut in December, but Bitcoin opened sharply lower, global financial markets are closely watching Trump's final announcement. This personnel appointment, driven by political forces, will not only profoundly impact the future direction of the Fed's monetary policy but also have far-reaching effects on global financial markets.
Related: Bitcoin (BTC) plummeted 5% in a flash crash, recording its worst November performance since 2018.
Original article: “Trump confirms Fed chair pick, market uncertainty rises”
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