Fed chair race narrows to five as Bessent weighs reform and independence
The race for the next Federal Reserve leader is taking shape, with Treasury Secretary Scott Bessent trimming the candidate list from 11 to five after a series of in-depth interviews lasting up to two hours each, as per a CNBC report.
The decision, expected by January, will shape how the Fed balances inflation control, interest-rate policy, and independence under President Donald Trump’s administration.
The shortlist includes Vice Chair for Supervision Michelle Bowman, Governor Christopher Waller, National Economic Council Director Kevin Hassett, former Fed Governor Kevin Warsh, and BlackRock Fixed Income Chief Investment Officer Rick Rieder.
The next chair could first be nominated as a Fed governor before assuming the top role later, the report added.
Trump era scrutiny brings new focus to Fed independence
This year’s selection process is unfolding under exceptional political pressure.
President Trump’s frequent criticism of the Fed’s policy stance and his open demand for lower interest rates have placed the central bank’s autonomy in question.
The controversy deepened after he dismissed Fed Governor Lisa Cook over alleged mortgage fraud, which she denies.
The Supreme Court will hear her appeal in January after lower courts blocked the firing.
These developments have elevated the stakes for the upcoming appointment.
Outgoing Chair Jerome Powell’s term ends in May, and his successor’s selection will determine whether the Fed can preserve its independence amid shifting White House priorities.
The Treasury secretary’s travel commitments, including next week’s World Bank and IMF meetings in Washington, followed by an Asia tour with Trump, could delay final decisions until after Thanksgiving.
The aim is to submit a reduced shortlist for presidential consideration soon after.
A strategic approach to terms and tenure
A key procedural issue driving the timing of the appointment is the duration of available Fed seats.
Powell currently occupies a governor’s seat with two years remaining, while another seat—vacated by Adriana Kugler and now held by Stephen Miran—offers a full 14-year term ending in January.
The new chair could be first nominated to this longer-term seat to ensure stability and continuity.
Although the Treasury has not confirmed which route will be chosen, the consideration underlines a broader strategic effort to solidify institutional influence over the next decade.
The administration’s handling of the process—making candidate names public as the list evolved—marks a departure from the discretion typically associated with central bank appointments.
Rick Rieder gains attention amid reform ambitions
Among the contenders, Rick Rieder of BlackRock has reportedly impressed Bessent.
Known for his analytical insights into fixed-income markets and monetary trends, Rieder’s profile stands out as the only candidate without prior Fed experience.
His potential nomination signals a preference for perspectives outside the traditional policymaking circle, according to CNBC.
Bessent’s recent essay on Fed reform provides further context. He criticised the central bank for expanding its mandate beyond its core objectives.
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Fed chair race narrows to five as Bessent weighs reform and independence
The race for the next Federal Reserve leader is taking shape, with Treasury Secretary Scott Bessent trimming the candidate list from 11 to five after a series of in-depth interviews lasting up to two hours each, as per a CNBC report.
The decision, expected by January, will shape how the Fed balances inflation control, interest-rate policy, and independence under President Donald Trump’s administration.
The shortlist includes Vice Chair for Supervision Michelle Bowman, Governor Christopher Waller, National Economic Council Director Kevin Hassett, former Fed Governor Kevin Warsh, and BlackRock Fixed Income Chief Investment Officer Rick Rieder.
The next chair could first be nominated as a Fed governor before assuming the top role later, the report added.
Trump era scrutiny brings new focus to Fed independence
This year’s selection process is unfolding under exceptional political pressure.
President Trump’s frequent criticism of the Fed’s policy stance and his open demand for lower interest rates have placed the central bank’s autonomy in question.
The controversy deepened after he dismissed Fed Governor Lisa Cook over alleged mortgage fraud, which she denies.
The Supreme Court will hear her appeal in January after lower courts blocked the firing.
These developments have elevated the stakes for the upcoming appointment.
Outgoing Chair Jerome Powell’s term ends in May, and his successor’s selection will determine whether the Fed can preserve its independence amid shifting White House priorities.
The Treasury secretary’s travel commitments, including next week’s World Bank and IMF meetings in Washington, followed by an Asia tour with Trump, could delay final decisions until after Thanksgiving.
The aim is to submit a reduced shortlist for presidential consideration soon after.
A strategic approach to terms and tenure
A key procedural issue driving the timing of the appointment is the duration of available Fed seats.
Powell currently occupies a governor’s seat with two years remaining, while another seat—vacated by Adriana Kugler and now held by Stephen Miran—offers a full 14-year term ending in January.
The new chair could be first nominated to this longer-term seat to ensure stability and continuity.
Although the Treasury has not confirmed which route will be chosen, the consideration underlines a broader strategic effort to solidify institutional influence over the next decade.
The administration’s handling of the process—making candidate names public as the list evolved—marks a departure from the discretion typically associated with central bank appointments.
Rick Rieder gains attention amid reform ambitions
Among the contenders, Rick Rieder of BlackRock has reportedly impressed Bessent.
Known for his analytical insights into fixed-income markets and monetary trends, Rieder’s profile stands out as the only candidate without prior Fed experience.
His potential nomination signals a preference for perspectives outside the traditional policymaking circle, according to CNBC.
Bessent’s recent essay on Fed reform provides further context. He criticised the central bank for expanding its mandate beyond its core objectives.
The post Fed chair race narrows to five as Bessent weighs reform and independence appeared first on Invezz
Read More