Kevin Hassett, director of the National Economic Council, and Kevin Warsh, former governor of the U.S. Federal Reserve, are at the center of speculation regarding the next Federal Reserve chair nominee.
On the Kalshi trading platform, Hassett's chances of securing the nomination rose to about 53% on Tuesday, up from 39% earlier in the day, after news of internal dissent from figures close to President Donald Trump. Meanwhile, Warsh's implied probability dropped to 33% from 46% earlier on Tuesday.
Hassett regained a leading position in the prediction markets regarding Trump's choice for the next Federal Reserve chair after initially losing ground to Warsh. This shift followed Hassett's supportive comments about central bank independence during his CNBC appearance and his emphasis on the significance of reaching consensus.
"The Federal Reserve's independence is really, really important, and the voices of the other people at the [Federal Open Market Committee], they're important, too," Hassett stated. "So the way you've got to drive interest rate movements is with consensus based on the facts and the data."
Hassett's odds had previously dipped due to pushback from senior figures with direct access to Trump, who expressed concerns about his close association with the president. Warsh, who served as a Fed governor from 2006 to 2011, is regarded as a reputable choice for Republicans. However, Hassett's role within Trump's economic team across both terms has raised worries about potential impacts on the Federal Reserve's institutional integrity.
The contest for the Federal Reserve chairmanship intensified after Trump introduced uncertainty last week. Although he had earlier claimed to know his pick for Fed chair, Trump later mentioned to the Wall Street Journal that Warsh had ascended to a leading position among contenders.