WASHINGTON, Jan 30 — President Donald Trump said yesterday he intends to announce his pick to replace Federal Reserve Chair Jerome Powell today, with speculation intensifying that the nod will go to former Fed governor Kevin Warsh.
“I’ll be announcing the Fed chair tomorrow morning,” Trump said at the Kennedy Center yesterday, in response to a question from Reuters.
Bloomberg News later reported that the White House is preparing for Trump to nominate Warsh as the next Fed chair, citing people familiar with the matter.
Warsh, on the shortlist of candidates to lead the central bank when Powell’s leadership term ends in May, went to the White House for a meeting with Trump yesterday, according to one source familiar with the matter.
A second source, briefed on the discussion, said the former Fed governor impressed Trump, adding that nothing was final until Trump announced his pick.
Trump wants the Fed to cut interest rates deeply. His escalating pressure on Powell and the Fed for cuts has given rise to the possibility that Powell might remain at the Fed beyond May to try to safeguard the Fed from further political pressure. Powell’s separate term as a member of the Board of Governors runs to 2028.
The Fed, which cut rates three times in 2025, left its benchmark interest rate unchanged in the 3.50 per cent-3.75 per cent range after the end of a two-day policy meeting yesterday. Trump says the rate should be two to three percentage points lower, a level historically consistent with a stalled or faltering economy. The economy grew at a 4.4 per cent annualised rate in the third quarter, according to Commerce Department data.
Over the course of the Trump administration’s months-long search for Powell’s successor, the president has been seen to favour different candidates, even as he has ramped up his campaign to exert influence over the Fed, whose independence from political pressure is seen as key to its ability to control inflation. In recent months Trump has tried to fire a Fed governor in a case now before the Supreme Court, and his Justice Department has opened a criminal investigation into Powell over cost overruns for renovations at the Fed’s headquarters in Washington — a move the Fed chief has called out as a “pretext” to pressure him over monetary policy.
Four candidates on Trump’s short list
All candidates to take the reins from Powell agree with Trump that rates should be lower. That was one of the president’s explicit criteria for his pick.
Yesterday, Warsh leapt to the top of betting sites’ favourites as a contender for the job, with pricing at prediction markets Polymarket and Kalshi both putting his chances at more than 80 per cent.
Warsh has called for regime change at the central bank and wants, among other things, a smaller Fed balance sheet, a goal seemingly at odds with Trump’s preference for looser monetary policy. Trump almost picked Warsh in 2018 for the top Fed job, but chose Powell instead — a decision the president has publicly and loudly regretted for much of the time since then.
Rick Rieder, chief investment officer of BlackRock’s global fixed income business, had as recently as Wednesday been the odds-on favourite to be Trump’s nominee. Rieder, who has never worked in government or at the Fed, would bring a fresh face to an institution that the president accuses of entrenched political bias.
Fed Governor Christopher Waller, one of two policymakers who dissented this week in the central bank’s decision to keep rates unchanged, is also in the running. He was the first Fed policymaker to make the economic case for lower rates, saying that tariffs would not cause inflation and the economy needed the support, both arguments that have won over many of his colleagues and helped seal support for the rate cuts last year.
White House economic adviser Kevin Hassett was an early front-runner for the job but is now seen as an unlikely choice after Trump said he would rather keep him in his current post. Hassett is an economist and an unapologetic cheerleader for many of the president’s orthodox-defying policies, including high tariffs and an immigration crackdown. — Reuters
