Potential Fed chair pick David Zervos of Jefferies backs aggressive interest rate cuts

For the past three Fed meetings, Zervos has advocated a half percentage point cut in the federal funds rate, and he repeated that position during an interview."I'm still absolutely there

I think there is a reasonable storyline, a very cogent storyline, that suggests monetary policy is restrictive," he said. "Generally speaking, I don't see any reason why this [PPI] number changes that view."A cess that had included just three or four names to succeed Fed Chair Jerome Powell when his term expires next year has expanded in recent days to nearly a dozen.Zervos joins a list that includes current and past Fed officials, at least one Trump administration advisor and multiple other noted Wall Street economists

Of the group, Zervos and BlackRock bond strategist Rick Rieder are the only ones whose background is more concentrated on than economics."I think it would be an incredible benefit to have more market-savvy, more market-competent people involved in the monetary policy decision," Zervos said.Earlier in the day, economist Marc Sumerlin, also on the list of finalists, backed a half-point cut as well and said the Fed has been too conservative in fighting the inflation battle.President Donald Trump has pushed hard for the Fed to cut, lashing out repeatedly at Powell and suggesting that the Federal Open Market Committee should slash as much as 3 percentage points, or 300 basis points, off the funds rate, which is currently around 4.33%."I don't know that I could get all the way to 300, but I certainly could get to 200 and I could be convinced on lower than that if you really push the AI story and the nology story and the idea that we have disinflationary pressures building from a supply-side narrative," Zervos said.Zervos added that he is not deterred by the types of criticism Trump has leveled at the Fed."You go into that job fully understanding that you're involved in the political cess," he said. "The goal is to have the debate be driven by facts and be driven by what is best for achieving the mandates that Congress sets out."Don’t miss these insights from CNBC Forget Palantir