Hassett is currently widely regarded as the hottest candidate to succeed the current Federal Reserve Chair Powell. As market expectations for the Fed's future monetary policy begin to shift—particularly towards a quicker rate cut to stimulate economic growth—Hassett's "dovish" stance is being valued by investors and decision-makers. If appointed, he is believed to potentially push for a more aggressive pace of rate cuts, which could boost the stock market and have far-reaching effects on the dollar and global capital flows.

However, given his close ties to the current administration, there are concerns about the potential political interference in the Fed's independence, which will be key to whether he can earn the trust of the market and the international community after taking office.

Nonetheless, some have pointed out that Trump has a history of unexpected personnel and policy decisions, so the nomination cannot be considered finalized until it is publicly announced. White House Press Secretary Karoline Leavitt stated in a statement, "No one really knows what President Trump will do; we will just have to wait and see!"

Trump has long criticized the Federal Reserve, accusing Powell of "cutting rates too slowly" and even openly expressing a desire to fire him. Additionally, Trump has criticized the Fed's office renovation project, and the White House is currently involved in litigation over its attempt to remove Fed Governor Lisa Cook from her position. In this context, Treasury Secretary Mnuchin, who is responsible for selecting the next Fed Chair, faces significant pressure to find a candidate who supports rate cuts while also gaining the trust of the president and the financial markets.

Since this summer, Mnuchin has interviewed nearly ten candidates in the succession process, which has now been narrowed down to five: Hassett, Kevin Warsh, Christopher Waller, Fed Vice Chair and regulatory official Michelle Bowman, and Rick Rieder from BlackRock. Mnuchin stated that interviews will conclude this week, after which some candidates will meet with White House Chief of Staff Susie Wiles and Vice President Pence. The Fed Chair nominee will also need Senate confirmation.

In an interview with CNBC, Mnuchin indicated that the president might announce the Fed Chair nominee next month, before Christmas. Trump himself has hinted that he is close to a decision, stating on November 18, "I think I know my choice." However, he did not disclose the specific candidate.

Former White House Press Secretary Sean Spicer remarked, "The president saw how important it was during his first term to appoint people in key positions like the FBI Director and the Fed Chair who understand his direction and priorities. I can't imagine he would appoint someone without a close personal relationship to succeed Powell."

As an important figure in U.S. economic policy circles, Hassett has a rich professional background. Background information shows that he taught at Columbia Business School in his early years and then served as an economist in the Research and Statistics Division of the Federal Reserve Board from 1992 to 1997. Since 1997, he has been with the conservative think tank American Enterprise Institute (AEI), focusing on issues such as taxation, finance, capital formation, and economic growth, and has served as the institute's Director of Economic Policy Research since 2003.

On the public policy front, he has provided economic advisory services to several Republican presidents or candidates, including participating in the campaigns of John McCain, George W. Bush, and Mitt Romney, and served as the Chair of the Council of Economic Advisers during Trump's first term. In 2025, he became one of the key architects of presidential economic policy, being appointed as the Director of the National Economic Council.

This combination of academic background, central bank experience, and practical policy experience makes Hassett a strong contender for the next Fed Chair.

In a recent public statement, Hassett clearly indicated that if he were to become Fed Chair, he would advocate for "larger rate cuts." Following this news, the bond market reacted, with the 10-year U.S. Treasury yield falling below 4% for the first time, indicating the market's sensitivity to the possibility of Hassett's appointment.

In the cryptocurrency space, his personal holdings also reflect a "friendly" attitude: in June of this year, Hassett disclosed that he holds at least $1 million in Coinbase shares and has served as an advisor on its academic and regulatory advisory board.

However, this "pro-crypto/dovish monetary policy" combination has also sparked controversy. Critics worry that his private holdings in the crypto industry could lead to conflicts of interest regarding regulatory fairness; at the same time, his inclination towards rate cuts and easing policies, if accompanied by regulatory leniency, could trigger market asset bubbles or financial stability risks.

Market analyst Neil Dutta pointed out that even if Hassett is elected, it may be difficult to persuade other members of the Federal Open Market Committee (FOMC) to support his rate cut stance, stating, "It won't be easy for him to serve as chair next year, and he will be most susceptible to pressure from Trump."

The next Fed Chair is expected to be appointed for a 14-year term, starting on February 1, 2026. The vacancy at that time will be filled by current Governor Stephen Miran. Powell's term as chair will end in May 2026, but he can continue to serve as a governor for two more years. Powell has not yet indicated whether he will leave the board after his term ends; if he does, it will create a new vacancy for the administration.

The coming weeks will be a critical time window. Once the White House makes a decision, the Fed's policy direction, regulatory stance, and even global market sentiment could reach a new turning point. Whether this potential "new leader" can find a balance between political pressure, market expectations, and institutional independence will be a core test that influences the landscape of U.S. monetary policy for the next decade.

Original article: “Five Candidates for the Fed Chair Position: Why is Hassett Pulling Ahead?”

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