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<ul><li>Pushback grows around Hassett as advisers worry about Fed independence and bond markets.</li><li>Trump names Warsh alongside Hassett, and prediction markets quickly reprice the race.</li><li>Hassett says the Fed will act on data and committee votes, not presidential views.</li></ul>Kevin Hassett’s once-dominant candidacy to lead the Federal Reserve now faces resistance as rival Kevin Warsh gains momentum and concerns grow over perceived political closeness to President Donald Trump. Sources familiar with the process said pushback emerged from senior figures close to Trump, raising doubts about Hassett’s suitability despite his earlier status as the frontrunner to replace Jerome Powell.The shift followed Trump’s remarks to the <a href="https://www.wsj.com/economy/central-banking/trump-says-he-is-leaning-toward-warsh-or-hassett-to-lead-the-fed-34a200e5?gaa_at=eafs&amp;gaa_n=AWEtsqfhgZaiig3baRXhWsmfCU9K1Y29cCeHn7g9oxGt2GHuNzhDr4qjbL8GR8T3H_c%253D&amp;gaa_ts=693ef544&amp;gaa_sig=25IDjxH2wvM5ZPDEVgHfdtMfZmfMcjNdUyno7STc2n4S9rRGQ_eOhcQ1eSxr14HF0MvGqvHM0IwGlnkwGuR5gA%253D%253D" rel="noopener noreferrer nofollow">Wall Street Journal</a>, where he said former Fed Governor Kevin Warsh had joined Hassett at the top of his candidate list. Those comments surprised investors and quickly reshaped betting markets, signaling that the decision process remains unsettled as Powell’s term nears its May end.<h2 id="strong-market-odds-shift-after-trump-signals-two-front-runners-strong">Market Odds Shift After Trump Signals Two Front-Runners</h2>Following Trump’s interview, prediction markets reacted sharply, with Hassett’s odds on Kalshi falling to 51% from above 80% earlier this month. At the same time, Warsh’s odds climbed to 44%, up from about 11% at the start of December, reflecting growing market belief in a competitive race.<a href="https://cryptotale.org/trump-strategy-drops-crypto-prioritizes-ai-and-quantum/https:/cryptotale.org/trump-strategy-drops-crypto-prioritizes-ai-and-quantum/" rel="noopener noreferrer nofollow">Trump</a> told reporters he knew his choice for Fed chair, yet later said, “I think the two Kevins are great,” adding uncertainty to the selection timeline. Earlier in December, interviews with candidates were canceled, according to sources, before being rescheduled for Washington last week.The cancellations and reversals suggested internal debate, as advisers weighed market reaction and institutional credibility ahead of a formal nomination. Could concerns about bond market confidence reshape Trump’s final decision?<h2 id="strong-independence-concerns-and-bond-market-sensitivity-strong">Independence Concerns and Bond Market Sensitivity</h2>According to a report, several sources said resistance to Hassett stemmed from fears that markets could view him as too close to Trump, potentially unsettling long-term bond investors. Critics worried such perceptions could drive higher yields if investors feared weaker inflation control under a politically aligned Fed chair.Those concerns appeared indirectly addressed during Hassett’s recent media appearances, where he stressed Federal Reserve independence more firmly than before. In a <a href="https://www.cbsnews.com/news/kevin-hassett-national-economic-council-face-the-nation-12-14-2025/" rel="noopener noreferrer nofollow">CBS News</a> “Face the Nation” interview, Hassett said Trump would have “no weight” in Federal Open Market Committee rate decisions.“His opinion matters if it’s good, if it’s based on data,” Hassett said, adding that committee members would vote independently if they disagreed. He later said the Fed’s role requires consensus among governors, not direction from the White House.Related:<a href="https://cryptotale.org/trump-narrows-fed-chair-race-to-warsh-or-hassett-choice/" rel="noopener noreferrer nofollow">Trump Narrows Fed Chair Race to Warsh or Hassett Choice</a><h2 id="strong-warsh-gains-support-as-hassett-reaffirms-fed-autonomy-strong">Warsh Gains Support as Hassett Reaffirms Fed Autonomy</h2>Support for Warsh has grown quietly, often through promotion rather than direct criticism of <a href="https://cryptotale.org/polymarket-traders-back-hassett-as-trumps-fed-favorite/" rel="noopener noreferrer nofollow">Hassett</a>, according to people familiar with the discussions. At a JPMorgan event Thursday, CEO Jamie Dimon spoke positively about both candidates, though audience members sensed stronger backing for Warsh.According to reports from late November, Hassett had emerged as the leading contender, based on early internal discussions. As December progressed, sources said concerns intensified about how markets might interpret Hassett’s relationship with Trump over time.Trump, however, said Friday that he “certainly should have a role” in discussions with the Fed chair about interest rates. That comment marked a break from decades of presidential restraint, as economists traditionally favor an independent Fed to manage inflation risks.Until 2016, presidents from both parties largely avoided public or private pressure on Fed policy decisions, believing that independence supports price stability. The evolving contest now reflects competing priorities between market confidence, political alignment, and institutional norms as the Fed leadership decision approaches.Read more on <a href="https://cryptotale.org/hassett-faces-pushback-as-warsh-rises-in-fed-chair-race/" rel="noopener noreferrer nofollow">CryptoTale.</a>

Hassett Faces Pushback as Warsh Rises in Fed Chair Race

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