Trump's Statement "Locks In" Federal Reserve Chair Candidate, Kevin Warsh Emerges as the Frontrunner

BlockBeats News, January 17 — Today, when talking about White House National Economic Council Director Kevin Hassett, Trump stated, "I want him to stay in his current position, we'll see." This remark suggests that Trump may have another candidate in mind for the Federal Reserve Chair, and market expectations for the Fed Chair have shifted from being split between Kevin Hassett and Kevin Warsh to Warsh taking the clear lead. Notably, before Trump's statement today, Hassett himself also commented, "Warsh and Rieder would also make great Fed Chairs." Perhaps Hassett is already aware of Trump's final choice.

According to prediction market Polymarket data, the probability of Hassett being nominated as Chair has dropped to 15%, on par with Fed Governor Waller, while Kevin Warsh's nomination probability has risen to over 60%. Warsh has now become the frontrunner, leaving other candidates far behind.

Compared to Trump's close ally and "absolute dove" Hassett, Kevin Warsh holds a more hawkish stance, but the market still expects Warsh to support rate cuts while advancing balance sheet reduction (QT). Earlier this year, Warsh proposed the view that "inflation is a choice," arguing that inflation is not caused by supply chains or geopolitics, but stems from the Fed's own policy decisions. Warsh is extremely optimistic about the U.S. economic outlook, believing that AI and deregulation will bring about a productivity boom similar to that of the 1980s.