Treasury Secretary Bessent Reportedly Leading Search for Next Fed Chair as Powell’s Term Nears End 🏛️

In a potential second Trump administration, top economic advisor Scott Bessent is reportedly set to play a pivotal role in selecting a successor for Federal Reserve Chair Jerome Powell, whose term concludes in May 2026. Sources suggest that former President Donald Trump is keen to announce his choice for the crucial position soon, setting the stage for a significant shift in U.S. monetary policy.

Powell's Successor Could Be Named Soon, as Bessent Warns of Market Risks

In this forward-looking scenario, Scott Bessent, in his capacity as Treasury Secretary, is spearheading the process to replace Jerome Powell. Trump has indicated an announcement could come within weeks, a move designed to signal his economic intentions early.

The list of potential candidates under consideration is a who's who of conservative economic thinkers. It reportedly includes Bessent himself, former Fed Governor Kevin Warsh, former Director of the National Economic Council Kevin Hassett, current Fed Governor Christopher Waller, and former World Bank President David Malpass. Warsh, often seen as an early front-runner, has already been interviewed by Trump and is known for his critical views on the Fed's credibility and recent performance.

This entire search is taking place against a backdrop of intensified debate about the central bank's future. Recent in-depth reports from The Wall Street Journal have revealed that close allies of Donald Trump are actively drafting proposals aimed at fundamentally curbing the Federal Reserve's political independence. These plans could potentially give the White House a formal role in steering interest rate policy, a move that would upend decades of central banking tradition and make the selection of the next Fed Chair a matter of immense significance for the global financial system.

Bessent's own involvement is multifaceted. As Treasury Secretary, he would be a key advisor guiding the selection effort. Simultaneously, his name features prominently on shortlists of potential contenders, drawing significant attention given his role in shaping Trump's economic policies on trade, taxes, and regulation.

The administration's accelerated timeline aims to finalize a nominee quickly, with formal interviews expected to begin shortly. However, this fast-tracked process has ignited debate. Bessent himself has publicly cautioned that replacing Powell prematurely could destabilize financial markets, adding a layer of complexity to the decision-making process. Analysts see the potential early replacement as a clear effort to align the Federal Reserve more closely with Trump's economic agenda, particularly his desire for lower interest rates to fuel growth.

Signaling his own policy leanings, Bessent has publicly stated that tariffs have not fueled inflation, a view that aligns with Trump's trade policies and is highly relevant for the future direction of the Fed.

As of now, the formal interview process has not yet commenced. The final selection ultimately rests with President Trump, who will choose a candidate based on the economic priorities of his administration. The coming weeks are viewed as absolutely critical for determining the future leadership—and independence—of the world's most powerful central bank.