The battle to lead the United States central bank appears to be narrowed down to two primary candidates.
The front runners: “The two Kevins”
Speak of The Wall Street Journal from the Oval Office on Friday, President Donald Trump indicated that he decides between the director of the National Economic Council Kevin Hassett and former Governor of the Federal Reserve Kevin Warsch.
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While recent speculation positioned Hassett as the likely winner, the president’s latest comments suggest the race is far from decided.
He praised both men, but noted that Warsh is currently very high on his list of potential nominees.
“Yes, I think so. I think you have Kevin and Kevin. They’re both – I think the two Kevins are great,” Trump said. “I think there are a few other people who are great.”
Hassett, who has a doctorate in economics and has served multiple terms in government since 2017, recently downplayed betting market rumors that pegged him as a likely pick.
Policy alignment and presidential influence
An important criterion for the appointment is alignment with monetary easing. During a forty-five minute strategy session at the White House last Wednesday, the President reportedly specifically questioned Warsh about his willingness to lower borrowing costs.
Trump later confirmed this exchange, noting that Warsh agrees with the need for tariff cuts.
The president also outlined a shift in the way he views the relationship between the White House and the Fed.
He argued that the agency’s leader should consult with him on interest rate adjustments. While he acknowledged that the president is not obligated to follow his directives, Trump emphasized that his perspective as a “smart voice” deserves attention.
Trump stated that his economic goal is to lower interest rates to 1% or less, arguing that the US should have the lowest borrowing costs worldwide to manage the financing of $30 trillion in government debt.
Market context
The meeting took place shortly after the central bank cut its benchmark interest rate by a quarter point to a range of 3.5% to 3.75%.
The decision was controversial and led to three votes against: two officials preferred to keep interest rates stable, while a former Trump adviser Stephen Miran pushed for a more aggressive cut of half a point.
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