The selection of the next chairman of the Federal Reserve is entering its final stage. Although White House National Economic Council Director Hassett is currently in a leading position, Trump's decision to initiate the final round of interviews indicates that the final candidate is far from being "confirmed".

Today, according to the Financial Times citing three senior US government officials, Trump and Treasury Secretary Besson plan to meet with former Federal Reserve Governor Walsh on Wednesday. This move marks the official start of the final round of interviews to find a successor to current Chairman Powell.

This latest development indicates that Hassett's nomination is not guaranteed. In addition to Hassett and Walsh, the final candidate list also includes two other nominees from Federal Reserve Board members Waller, Baumann, and BlackRock executive Rick Reid. The final decision is expected to be announced in early January next year.

The core impact of this personnel change lies in the future direction of monetary policy. Some Wall Street investors have expressed concerns that Hassett, who has close ties to the president, may cut interest rates too aggressively, potentially posing risks to the market.

Hassett leads, but term may be subject to change

In recent weeks of competition, Hassett has become a popular candidate to replace Powell. However, officials in the Trump administration have proposed an idea to have Hassett serve as the Federal Reserve Chairman for a shorter term than the normal term. The regular term of office for the Federal Reserve Chairman is four years, and he/she can be re elected.

Two other insiders claimed that Hassett himself had proposed to Besant to replace Powell's seat on the Federal Reserve Board, which would end in January 2028. The flexibility of this arrangement leaves room for future personnel layout.

Beisen still has the possibility of taking over the Federal Reserve

Finance Minister Besant plays a key role in this selection process. According to officials, he submitted a list to the White House containing the names of four people, including Hassett and Walsh. Although Trump has publicly expressed his desire for Besant to serve as the chairman of the Federal Reserve multiple times, Besant himself has stated that he has no intention of holding this position.

However, if Hassett's term is shortened, it may pave the way for Besant to take over the Federal Reserve later in Trump's second term. This potential arrangement implies that there may be longer-term strategic considerations behind the current selection.

Market Concerns and Hassett's Response

Hassett's leading position has caused unease among some bond investors. According to reports, these investors have expressed concerns to the Ministry of Finance that Hassett may aggressively cut interest rates. They believe that if this leads to high inflation, it may shake the US treasury bond bond market with a scale of up to $30 trillion.

To alleviate market doubts, Hassett recently attempted to emphasize the importance of central bank independence. He stated at an event on Tuesday that although he believes there is still room for further interest rate cuts, the "most important job" of the Federal Reserve chairman is to "focus on economic data and avoid getting involved in politics".

The entire selection process took place against the backdrop of Trump's long-standing criticism of current Chairman Powell. Over the past year, Trump has consistently criticized Powell for failing to lower borrowing costs faster and more significantly. The market generally expects that the Federal Reserve will announce a 25 basis point interest rate cut on Wednesday, lowering the target range for the federal funds rate to a three-year low of 3.5% to 3.75%.

Nevertheless, Trump publicly called for reducing the cost of borrowing in the United States to the level of 1%. For any new chairman, striking a balance between the president's expectations and maintaining central bank independence will be a huge challenge.

The selection of the next chairman of the Federal Reserve is entering its final stage. Although White House National Economic Council Director Hassett is currently in a leading position, Trump's decision to initiate the final round of interviews indicates that the final candidate is far from being "confirmed".

Today, according to the Financial Times citing three senior US government officials, Trump and Treasury Secretary Besson plan to meet with former Federal Reserve Governor Walsh on Wednesday. This move marks the official start of the final round of interviews to find a successor to current Chairman Powell.

This latest development indicates that Hassett's nomination is not guaranteed. In addition to Hassett and Walsh, the final candidate list also includes two other nominees from Federal Reserve Board members Waller, Baumann, and BlackRock executive Rick Reid. The final decision is expected to be announced in early January next year.

The core impact of this personnel change lies in the future direction of monetary policy. Some Wall Street investors have expressed concerns that Hassett, who has close ties to the president, may cut interest rates too aggressively, potentially posing risks to the market.

Hassett leads, but term may be subject to change

In recent weeks of competition, Hassett has become a popular candidate to replace Powell. However, officials in the Trump administration have proposed an idea to have Hassett serve as the Federal Reserve Chairman for a shorter term than the normal term. The regular term of office for the Federal Reserve Chairman is four years, and he/she can be re elected.

Two other insiders claimed that Hassett himself had proposed to Besant to replace Powell's seat on the Federal Reserve Board, which would end in January 2028. The flexibility of this arrangement leaves room for future personnel layout.

Beisen still has the possibility of taking over the Federal Reserve

Finance Minister Besant plays a key role in this selection process. According to officials, he submitted a list to the White House containing the names of four people, including Hassett and Walsh. Although Trump has publicly expressed his desire for Besant to serve as the chairman of the Federal Reserve multiple times, Besant himself has stated that he has no intention of holding this position.

However, if Hassett's term is shortened, it may pave the way for Besant to take over the Federal Reserve later in Trump's second term. This potential arrangement implies that there may be longer-term strategic considerations behind the current selection.

Market Concerns and Hassett's Response

Hassett's leading position has caused unease among some bond investors. According to reports, these investors have expressed concerns to the Ministry of Finance that Hassett may aggressively cut interest rates. They believe that if this leads to high inflation, it may shake the US treasury bond bond market with a scale of up to $30 trillion.

To alleviate market doubts, Hassett recently attempted to emphasize the importance of central bank independence. He stated at an event on Tuesday that although he believes there is still room for further interest rate cuts, the "most important job" of the Federal Reserve chairman is to "focus on economic data and avoid getting involved in politics".

The entire selection process took place against the backdrop of Trump's long-standing criticism of current Chairman Powell. Over the past year, Trump has consistently criticized Powell for failing to lower borrowing costs faster and more significantly. The market generally expects that the Federal Reserve will announce a 25 basis point interest rate cut on Wednesday, lowering the target range for the federal funds rate to a three-year low of 3.5% to 3.75%.

Nevertheless, Trump publicly called for reducing the cost of borrowing in the United States to the level of 1%. For any new chairman, striking a balance between the president's expectations and maintaining central bank independence will be a huge challenge.