Trump to Reveal Federal Reserve Chair Candidate as Markets Weigh Potential Rate Moves

US President Donald Trump plans to reveal the next Federal Reserve chair on Friday morning, increasing attention on future interest rates. The choice is expected to influence US monetary policy and global markets, including India, where shifts in US yields often affect foreign flows, the rupee and domestic bond pricing.

Trump confirmed the timing at an event at the Kennedy Center on Thursday, according to Reuters. "I'll be announcing the Fed chair tomorrow morning," Trump said. The decision follows a period of public pressure from Trump on the central bank and will indicate how forcefully the White House wants interest rates to move.

Prediction platform Kalshi, cited by Reuters on 27 January, places BlackRock executive Rick Rieder as the leading contender for Federal Reserve chair, with a 48% probability. Kevin Warsh ranks second at 31%, while Christopher Waller and Kevin Hassett each hold about 8%, highlighting a relatively concentrated field of potential appointees.

Rieder attracts attention because Rieder has never served inside the Federal Reserve system. Bloomberg reports that Trump has responded favourably to Rieder’s ideas for institutional reform. Some traders see Rieder’s outsider background as a strength, since Rieder may appear less tied to existing strategies at the central bank.

The upcoming appointment comes shortly after the Federal Reserve voted to keep its benchmark rate unchanged, following three consecutive cuts designed to support economic activity. That pause has sharpened the debate around the next move for borrowing costs, at a time when Trump continues to argue publicly that rates should now rise.

Trump’s stance has fluctuated over recent years but has usually favoured easier policy, including calls for lower rates. The present demand for hikes, after earlier criticism that rates were too high, adds complexity for markets. Investors in India track these shifts closely, given the links between US policy, risk appetite and capital flows.

Candidates for Federal Reserve chair and frontrunners

The shortlist for Federal Reserve chair includes four major names: National Economic Council head Kevin Hassett, former Federal Reserve governor Kevin Warsh, current Fed governor Christopher Waller and Rick Rieder from BlackRock. Any nominee will need to secure confirmation by the US Senate before formally taking office at the central bank.

The Wall Street Journal reported in December last year that Trump was leaning towards either Warsh or Hassett. Speaking to the newspaper on 12 December, Trump said: "Yes, I think he (Warsh) is (frontrunner). He thinks you have to lower interest rates. And so does everybody else that I've talked to. I think you have Kevin and Kevin. They're bothI think the two Kevins are great. I think there are a couple of other people that are great," he said.

Federal Reserve chair contenders’ backgrounds and policy views

Hassett holds a PhD in Economics and is viewed as a strong candidate because of longstanding links with Trump and consistent support for lower interest rates, according to reports. Hassett served as a senior economic adviser from 2017 to 2019, then returned briefly during the COVID-19 period in 2020, before becoming head of the National Economic Council in January 2025.

Warsh, a Federal Reserve Board member between 2006 and 2011, has often criticised the central bank’s reliance on models and its large balance sheet. The BBC notes that Warsh earned a reputation as "hawkish" while in office, backing higher rates. However, Warsh is currently seen as more willing to accept rate cuts in the short term.

Waller, nominated to the Federal Reserve Board by Trump in 2020, is a serving insider at the institution. Waller dissented from the latest decision to leave interest rates unchanged, joining one other official in opposition. Waller has argued that the Federal Reserve still has room to lower rates further, a view which earlier aligned with Trump’s push for looser policy.

Analysts quoted by the BBC suggest Waller does not have the same personal relationship with Trump that Hassett and Warsh enjoy. That perceived distance may weigh on Waller’s prospects, despite overlapping views with Trump at various times on the benefits of additional monetary easing.

Federal Reserve chair candidates and Kalshi probabilities

Kalshi’s pricing of Federal Reserve chair candidates, as of 27 January, is shown below. The figures highlight how market participants assess the likelihood of each contender being selected by Trump for the top role at the US central bank.

Federal Reserve chair candidate	Background	Kalshi probability (27 January)
Rick Rieder	BlackRock executive, never served at the Fed	48%
Kevin Warsh	Former Fed governor, critic of Fed strategy	31%
Christopher Waller	Current Fed governor, Trump nominee in 2020	About 8%
Kevin Hassett	National Economic Council head, former Trump adviser	About 8%

Kalshi’s numbers place Rieder clearly ahead, with Warsh second and Waller and Hassett some distance behind. Market participants view Trump’s final choice, expected on Friday morning, as a signal of how assertively the White House wants the Federal Reserve to act on interest rates in the coming years.