The Federal Reserve’s lineup is due to change this year; the term of Governor Stephen Miran (nominated by President Donald Trump to fill a vacancy last year) ends in January, and Chairman Jerome Powell’s tenure as Fed chair ends in May—with Trump indicating Jan. 21 that he is close to making a decision on Powell’s successor.
“We’re down to three, but we’re down to two. And I probably can tell you we’re down to maybe one, in my mind,” Trump told CNBC in Davos following the World Economic Forum. “All three are good.”
Powell has been at the helm of the Fed since Trump nominated him for the position during his first term in 2017. Despite that, since resuming office in 2025, Trump has taken a highly critical stance toward Powell and his cautious posture; under Powell, the Fed has said its goal is reaching 2% annual inflation and generally (though not always) has been hesitant to cut interest rates. The Department of Justice has launched an investigation into Powell, which the Fed chair himself has claimed is the administration attempting to leverage more influence over monetary policy.
After his term as chairman ends in May, Powell will have two years left on his term as governor. While Fed chairmen generally step down from the Fed entirely after their term as chair ends, Powell has yet to confirm his plans.
Some of the rumored contenders on Trump’s shortlist include:
Kevin Hassett
Kevin Hassett, director of the National Economic Council and one of Trump’s key economic advisors, is one of the candidates in the running to replace Powell. Hassett said last year that the U.S. is “behind the curve” on cutting interest rates, aligning himself with Trump’s position. In an interview on Thursday, Hassett told CNBC that the next Fed chair should be “an independent person who respects the mandates.”
However, Trump has made recent comments indicating he might pass over Hassett for a new role as Fed chair, indicating he prefers to keep him in his current role—specifically citing his strong performances when appearing on television to promote the administration’s agenda. Addressing Hassett directly at a White House event on Jan. 16, Trump said (per Politico):
“I actually want to keep you where you are if you want to know the truth. I’m saying, wait a minute, if I move him, these Fed guys, certainly the one we have now, they don’t talk much. I would lose you. It’s a serious concern to me.”
Politico also reports that lawmakers have voiced concern about Hassett’s nomination, and implications for the Fed’s independence, should he be nominated due to his closeness with and vocal support of the President.
Hassett has weighed in on the DOJ’s investigation into Powell, saying, “I expect that there’s nothing to see here (…) But I sure wish they had been more transparent.”
Christopher Waller
Fed Governor Christopher Waller, who was first nominated to the board at the end of Trump’s first term, is the leading contender among the board’s current lineup. Waller has taken a dovish view on monetary policy; in July 2025, he broke ranks and voted for interest rate cuts while most of the board voted to hold monetary policy. Waller has also made several public statements the last few months saying that he believes the labor market is a more pressing concern than inflation, indicating he would support more rate cuts.
Media outlets such as the BBC and Politico have suggested that Waller’s lack of a close relationship with Trump could hold him back from cinching the nomination. He has also said as recently as December 2025 that he would stress the vital importance of the Fed’s independence to the President, suggesting that even if his policy outlook is closer to Trump’s than Powell’s, he would strive to assert an independent image.
Even if Waller is not nominated to be Fed chair, his term as a member of the Fed will expire on January 31, 2030. Barring unforeseen circumstances, he will continue to play a crucial role in setting interest rates for the remainder of Trump’s term.
Kevin Warsh
Kevin Warsh, a former member of the Federal Reserve Board of Governors who was appointed in 2006 by President George W. Bush and served until 2011, has emerged as a possible frontrunner to return to the Fed—this time, as its chairman.
The Wall Street Journal reported that Trump was impressed by Warsh during an interview with him, and that the President might be flip-flopping between Hassett or Warsh as his favored nominee.
Warsh said in an interview on Fox Business this past October that the Fed is in need of “new management,” claiming that Trump’s policies are leading to economic growth while the Federal Reserve has been producing “stagflation.” Warsh has historically been called a “hawk” on monetary policy—in more recent comments on Fox Business, he suggested lowering interest rates, specifically to boost the housing market and 30-year fixed mortgage rates, while off-setting that by lowering the Fed’s balance sheet.
“Wall Street right now is booming; they don’t need any extra help,” Warsh argued on Fox Business. “That excess money (in the Fed’s balance sheet) can go to Main Street, and that will give us room for lower interest rates.”
Rick Rieder
Trump is also considering a nominee from the private sector of finance. Specifically,
investment giant BlackRock’s Chief Bond Investment Manager Rick Rieder. Trump told CNBC that Rieder was “very impressive.” A frequent commentator on financial and economic news, Rieder told CNBC last month that he believes the Fed still has room to cut more on interest rates.
Similar to Waller, Rieder has argued the soft jobs market is the most pressing concern and that interest rates should be set lower (specifically to 3%, compared to the current 3.5%-3.75% rate) to assist with employment. Rieder has not previously served in government, and according to reporting by CNN, his “outsider” status is viewed favorably by the White House.
Scott Bessent
Treasury Secretary Scott Bessent was floated last year as a possible pick for Fed chair, but this currently appears to be a longshot. In a Jan. 21 interview with CNBC, when asked about the possibility of nominating Bessent, Trump called Bessent “fantastic,” but said: “Scott only wants to stay where he is.”
Bessent, who made sweeping changes to the Consumer Financial Protection Bureau early in his tenure at the Treasury Department, appears to be close to the President’s decision-making process. In a Jan. 21 interview with CNBC, Bessent claimed that Trump’s picks for Fed chair had been narrowed down from 11 contenders to four—and the decision is likely to come soon.
While Axios reported that Bessent expressed concerns to Trump about opening the investigation into Powell—specifically that it could create a “mess” for financial markets—Bessent himself has since made comments publicly criticizing Powell’s under-investigation conduct.
