Trump Narrows Fed Chair Candidates to Four, Excludes Bessent

President Donald Trump has narrowed the list of potential candidates to replace Federal Reserve Chair Jerome Powell to four individuals, according to multiple reports. Treasury Secretary Scott Bessent is no longer in the running, as he has reportedly indicated a preference to remain in his current role [1][2]. Trump revealed this development during an appearance on CNBC's "Squawk Box," where he also named Kevin Hassett and Kevin Warsh as two of his top choices for the position [1].

Trump expressed frustration with Powell’s approach to monetary policy, particularly his reluctance to cut interest rates. The president has previously suggested removing Powell from his role but has since indicated that he is “highly unlikely” to fire him, following a Supreme Court ruling that limits the grounds on which a Fed chair can be dismissed [1]. Trump has also criticized Powell for the management of the Fed’s $2.5 billion headquarters renovation project [1].

The opportunity to name a new Fed chair arose after Governor Adriana Kugler announced her unexpected resignation. Trump described the move as a “pleasant surprise” and suggested that his nominee for Kugler’s seat could also be a potential candidate to replace Powell [1]. The president plans to make a decision on a replacement for Kugler by the end of the week [3].

Among the candidates, Kevin Hassett, currently the director of the National Economic Council, has been a strong advocate for the Trump administration’s economic policies, including tax cuts and tariffs. He previously served as chairman of the Council of Economic Advisers and has ties to conservative think tanks such as the American Enterprise Institute and the Hoover Institution [1]. Kevin Warsh, a former Fed governor, is another key contender. He has long supported Trump’s calls for lower interest rates and has criticized the current Fed for its handling of inflation and rate cuts post-pandemic [1].

Trump’s public criticism of the Federal Reserve has raised concerns among economists about potential political interference in monetary policy. Analysts warn that such influence could destabilize markets and complicate the Fed’s ability to maintain independence in its decision-making [1]. Despite these concerns, Trump remains focused on reshaping the Fed to align with his economic agenda, emphasizing the need for lower interest rates to benefit consumers and businesses.

Potential interest rate cuts could impact risk asset markets, including cryptocurrencies, by boosting liquidity and risk appetite, affecting major tokens like Bitcoin and Ethereum [1]. Economic analysts suggest that such leadership changes could result in significant realignment of regulatory frameworks and market strategies. Historically, shifts in Fed policy have triggered adjustments in investment portfolios across sectors, reaffirming the intricate links between policy and market dynamics [1].

Sources:

[1] https://www.cnbc.com/2025/08/05/trump-says-treasury-secretary-bessent-does-not-want-to-be-fed-chair-but-4-others-in-running.html

[2] https://www.usatoday.com/story/news/politics/2025/08/05/trump-four-finalists-fed-chair-scott-bessent/85522732007/

[3] https://www.theglobeandmail.com/business/article-trump-to-fill-federal-reserve-board-vacancy-by-weeks-end-says-hes/