Treasury Secretary Scott Bessent on Tuesday announced he is wrapping up interviews with candidates to succeed Federal Reserve Chair Jerome Powell, saying the Trump administration could reveal the final pick by the end of the year.
Bessent is nearing the end of selecting candidates to recommend to President Donald Trump to replace Powell, whose term expires in May.
In an update on the process this week, Bessent said he is looking for someone able to navigate what he described as a “very complicated operation” at the Fed. The Treasury Secretary has narrowed the list from eleven to five candidates, and Trump will likely announce his final decision “before the Christmas holidays,” Bessent added during a CNBC interview.
“So we’re going to have the last interview in the second round today…I think that there’s a very good chance that the president will make an announcement before Christmas,” Bessent said. “But it’s his prerogative, whether it’s before the Christmas holidays, and the New Year’s. But things are moving along very well.”
The Treasury Secretary also mused on how much prominence the central bank should enjoy, suggesting it should embrace more of a “background” role due to concerns that “monetary policy has gotten very complicated.”
“It’s more than just cutting rates… It’s no longer just a price setting of money,” Bessent said.
“There’s this very complicated calculus between the monetary policy, the balance sheet, and regulatory policy. And we’ve really emphasized in these interviews, what’s the interplay for that calculus in terms of the best way forward for the American economy, and what is each person’s point of view in terms of protecting the American people, protecting the economy,” the Treasury Secretary continued.
The slate of finalists is believed to include National Economic Council Director Kevin Hassett, former Governor Kevin Warsh, BlackRock executive Rick Rieder, and current Fed Governors Christopher Waller and Michelle Bowman, according to CNBC.
Trump told reporters in September that Hassett, Waller, and Warsh were “the top three” to replace Powell.
Powell’s exit will come after the president has often clashed with the chairman over monetary policy, expressing outrage that the central bank has not cut interest rates at the pace expected by the White House.
“There’s something wrong with him,” Trump said earlier this month. “I’ll be honest, I’d love to fire his ass. He should be fired. Guy’s grossly incompetent.”
The president recently jokingly threatened to fire Bessent for advocating for Powell to complete his full term last week.
“The only thing Scott’s blowing it on is the Fed, because the Fed, the rates are too high, Scott, and if you don’t get it fixed fast, I’m going to fire your ass, OK,” Trump said.
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On Tuesday, Bessent voiced additional concern about the central bank’s “new regime, and what is called the ample reserves regime.”
“It looks like that might be fraying a bit here in terms of whether the reserves are actually ample,” the Treasury Secretary said. “I think it’s time for the Fed just to move back into the background like it used to do, calm things down and work for the American people, set monetary policy on a good course….This isn’t sports, it’s people’s lives. And I think we just need to, like, calm down.”
