Kevin Hassett has emerged as the top candidate to be the next chairman of the United States Federal Reserve. The trend is an indication of a potential change in the direction of the central bank as interest rate policy becomes a significant topic of discussion.
Hassett’s Rate-Cut Stance Strengthens His Preference For Fed Chair
A Bloomberg report indicates that advisers close to President Donald Trump consider him the candidate of choice. The selection process is now at its final stage. Trump wants a candidate that shares his opinion of wanting more aggressive rate cuts.
Hassett is regarded as a person who fits into that standpoint. He earlier indicated that he was already going to cut rates based on existing economic statistics.
That open position has intensified anticipations that a shift of leadership would lead the central bank towards more rate cuts. The president has often stated that the Federal Reserve has been too slow in reducing the cost of borrowing. He has expressed his criticism severally against the current chairman Jerome Powell.
Therefore, there was no surprise that Trump claimed that he has his decision regarding the choice to replace Powell. The position is very important since the Fed chair directs policies over decisions dealing with inflation, employment and lending, as well as financial markets.
Bessent Hints That Fed Chair Announcement Is Near
The selection is being overseen by Treasury Secretary Scott Bessent. He recently indicated that the announcement would take place before Christmas. Five candidates have now been shortlisted due to the use of interviews.
They are Kevin Hassett, a former Fed official Kevin Warsh, current governor Christopher Waller, Vice Chair Supervision Michelle Bowman and BlackRock executive Rick Rieder. Recently, Waller indicated that he is open to more rate cuts in December.
The Federal reserve has reduced rates twice this fall. Nonetheless, there are still a lot of internal disagreements on when next cut rates. The ensuing uncertainty may make the next rate decision particularly close.
Worries Deepen Over the Fed’s Independence
The appointment of a new chair will likely change the policy outlook provided he is appointed ahead of the next meeting. The administration is involved in a court case over an effort by Trump to have Fed Governor Lisa Cook removed.
These conflicts have heightened concerns on the issue of influence by the president and the independence of the central bank. Meanwhile, Kevin Hassett remains silent about the potential of taking over the leadership of the central bank.
Source: https://coingape.com/kevin-hassett-emerges-as-trumps-top-pick-for-fed-chair/
