Who’s on Trump’s shortlist for Jerome Powell’s replacement at The Fed

Economy·Federal ReserveWho’s on Trump’s shortlist for Jerome Powell’s replacement at The FedBy Eleanor PringleBy Eleanor PringleReporterEleanor PringleReporterEleanor Pringle is an award-winning reporter at Fortune covering news, the economy, and personal finance

Eleanor previously worked as a correspondent and news editor in regional news in the U.K

She her journalism training with the Press Association after earning a degree from the University of East Anglia.SEE FULL BIO Donald Trump first nominated Jerome Powell for Fed chairman, and now is looking forward to replacing him.Drew Angerer - Getty ImagesPresident Trump is narrowing his shortlist to replace Jerome Powell as Fed chair

Kevin Warsh, Kevin Hassett, and Christopher Waller are emerging as top contenders—all are seen as more amenable to interest rate cuts

Trump confirmed Treasury Secretary Scott Bessent declined the role, saying, “I want to work with you,” while market-watchers weigh how each candidate could impact Fed independence and dollar strength

In 12 months’ time a different hand will be guiding the Federal Reserve

Chairman Jerome Powell is due to stand down in May of next year

Different—not new—because some of the candidates President Trump may be eyeing for nomination are already well-known figures in regional and central banking

The shortlist is getting narrower as the timeline for a nomination announcement draws closer

Last month the president said he would confirm his decision “very soon,” potentially in a bid to shift attention toward the incoming Fed chairman and away from Powell

This week Trump has also dropped another crumb for spectators: Treasury Secretary Scott Bessent won’t be moving over to the Fed

Bessent’s name had been circulating for the role courtesy of his background and close relationship to the president

But yesterday Trump told CNBC: “I love Scott, but he wants to stay where he is

I asked him just last night, ‘Is this something you want?’ [Bessent said], ’Nope, I want to stay where I am

He actually said, ‘I want to work with you.’ It’s such an honor

I said, ‘That’s very nice

The Oval Office has also made at least one of the criteria : The next Fed chairman must be more willing to cut rates

Option 1: Kevin Warsh A former member of the Board of Governors at the Fed, Warsh has been seen as a frontrunner for Fed chairman since President Trump took office

Trump has already talked warmly of Warsh, telling reporters on Air Force One last month that Warsh is “very highly thought of.” Warsh, currently a visiting fellow in economics at the Hoover Institution and a lecturer at the Stanford Graduate School of , is bullish on the American economy and has supported calls that Trump 2.0 could usher in a golden era for the nation

The White House might also some of the criticism Warsh has leveled at the Fed’s current thinking

Warsh told CNBC a few weeks ago that if he were the president a chief concern would be a Federal Reserve which doesn’t recognize the upsides in economic data. “What I’d be worried is a central bank that doesn’t see any of that

A central bank that is stuck with models from 1978, governance from a prior period, and [doesn’t] recognize we could be at the front end of a ductivity boom,” Warsh said. “If I were the president, I’d be worried that [the Fed] might not see it and they might think economic growth is somehow going to be inflationary.” For many years, Warsh has also called for a “regime change” at the Fed, and argued: “it’s not just a person, it’s an apach to economics … I’m troubled when I see them moving the goalposts

It is very puzzling to me, how you could think that we should do an emergency rate just last September and now all of a sudden you stand there a hawk

That’s not good for the institution, I don’t think it’s good for the economy to be changing the goalposts that.” Potentially a mark against Warsh’s name is that he has some characteristics of a hawk—those who would keep the base rate higher in order to keep inflation low

In a conversation with the Hoover Institute earlier this month, for example, he outlined price stability is at the core of restoring Fed credibility

To this end, wrote ING in a note to clients this morning, “Warsh stands out as the most USD-friendly candidate at this stage … We could see the dollar gain support on his nomination.” Option 2: Kevin Hassett Warsh isn’t even the only Kevin in contention, Trump revealed

Yesterday he said: “Both Kevins are very good, and there are other people that are very good, too.” Leading in the polls at present is Kevin Hassett, currently serving as Director of the National Economic Council

Hassett has been an integral figure in Trump 2.0 thus far, supporting on everything from trade deals under the new tariff regime to speaking with House members key legislation the ‘One Big, Beautiful Bill Act’

This very fact may ve to be the reason Trump may steer away from nominating Hassett: It may raise questions the independence of the Fed

Despite wanting a friendly face at the head of the FOMC, the White House will be mindful of the fact that the autonomy of the central bank is a fundamental strength of the economy

Trump already learned the hard way how react to perceived threats against this independence, after he was forced to walk back a threat to fire Powell and the revolted

Questions of transparency and independence have been rife over the past week after President Trump dismissed the chief of the Bureau of Labor Statistics (BLS) ing surprise and significant revisions to labor data reporting

Asked how he would address such criticisms, Hassett said: “I’m an economist, I’m not a politician

But when politicians look at numbers that make them wonder, then that suggests there needs to be more transparency.” In a note overnight, Goldman Sachs suggested that further hints the next chairman could come in the form of a replacement for Fed Governor Adriana Kugler, who resigned last week

Chief U.S. economist, Jan Hatzius, wrote: “If confirmed very quickly, the new governor might be able to participate in the September 16-17 FOMC meeting

But in more recent months, Waller has raised eyebrows as potentially auditioning for the role of Fed chairman

As UBS’s Paul Donovan wrote late last week: “Investors are bound to suspect that the rationale amounted to little more than an excited jumping up and down and shouting ‘pick me, pick me’ in the general direction of the White House.” Waller has lobbied for a rate cut for some time, and hinted that he would to see a quicker turnaround on when that action may take place

Yet even this has led economists to question whether the governor is a true advocate of a reduction, or is seeking to publicly appeal to the president for the role

As Jeremy Siegel, emeritus fessor of finance at the Wharton School of the University of Pennsylvania, wrote for WisdomTree, where he is a senior economist, last month: “Chris Waller argued … for a potential July rate cut

Is he auditioning to be Powell’s replacement? I agree with Waller, we’re too far above the neutral rate with tariffs coming.” Option 4: Relative outliers Elsewhere President Trump could look to FOMC member Michelle Bowman as a potential candidate, for she too dissented against the Fed’s decision to hold rates

Bowman, vice chair of supervision at the Fed, justified her stance with: “Inflation has moved considerably closer to our target, after excluding temporary effects from tariffs, and the labor market remains near full employment

With economic growth slowing this year and signs of a less dynamic labor market, I saw it as appriate to begin gradually moving our moderately restrictive policy stance toward a neutral setting.” “In my view, this action would have actively hedged against a further weakening in the economy and the risk of damage to the labor market.” And more widely, economist Judy Shelton’s name has also been floated

Shelton was, after all, a Trump nomination to the Fed during his first term but did not receive congressional backing to make it to the board

At the time many expressed concern how closely Shelton’s economic analysis was aligned to the president’s—including calls for a larger-than expected cut to rates—and questioned how highly she valued central bank independence

Explore this year's list.