Kevin Hassett, one of the leading contenders to become the next chair of the U.S. Federal Reserve, has pushed back against concerns that the central bank could fall under political influence, stressing that monetary policy decisions remain driven by data and votes not presidential pressure.
Speaking on CBS News’ Face the Nation, Hassett emphasized the Federal Reserve’s institutional independence as speculation grows over who will succeed current Fed Chair Jerome Powell. An announcement on the next chair is widely expected in mid-January.
When asked whether President Donald Trump’s views would influence policy decisions, Hassett was clear. He said the president’s opinion would only matter if it were grounded in solid economic data and persuaded policymakers on its own merits.
“The committee votes,” Hassett explained, referring to the Federal Open Market Committee’s 12 voting members. Any argument, regardless of its source, would need to stand up to scrutiny and earn support to shape policy outcomes.
Trump narrows the race
The contest to lead the Federal Reserve appears to be tightening. Trump recently told The Wall Street Journal that the field has narrowed from four finalists to two names: Kevin Hassett and former Fed governor Kevin Warsh.
Asked if Warsh was at the top of his list, Trump responded positively, adding that both candidates are highly qualified. “You have Kevin and Kevin,” Trump said. “I think the two Kevins are great.”
Prediction markets adjust expectations
The shifting tone has been reflected in prediction markets. Earlier this month, platforms such as Polymarket and Kalshi showed Hassett with odds as high as 85% to become the next Fed chair. Those probabilities fell after Trump publicly praised Warsh.
At the time of writing, Polymarket showed Hassett leading with a 52% chance, followed by Warsh at 39%, highlighting a much tighter race than before.
Fed policy and market reaction
Trump has also reiterated his belief that the Fed chair should consult with the White House on interest rate decisions a practice that has largely faded in recent decades. While saying he would not expect full compliance, Trump argued that his views should be considered.
Last week, the Federal Reserve cut interest rates by 25 basis points, bringing the target range to 3.5%–3.75%. Cryptocurrency markets showed little reaction following the decision, remaining largely flat as traders adopted a wait-and-see approach.
At the same meeting, Powell acknowledged the challenges facing policymakers, noting that inflation risks remain tilted upward while employment risks are leaning lower leaving no easy path for future decisions.
Trump has indicated he would like to see further rate cuts in 2026 and suggested that Warsh shares that view. For now, markets appear to be watching the Fed leadership decision closely, with monetary policy expectations playing a key role across equities, bonds and crypto alike.
