Kevin Hassett, director of the National Economic Council, left, and Kevin Warsh, former governor of the U.S. Federal Reserve.
Reuters
Kevin Hassett has reclaimed the lead in prediction markets betting on who President Donald Trump will nominate as the next chair of the Federal Reserve, after briefly losing ground to former Fed Governor Kevin Warsh.
On Kalshi, traders on Tuesday assigned Hassett a roughly 53% chance of securing the nomination, up from about 39% earlier in the day following reports of internal pushback from figures close to Trump. Warsh’s implied probability fell to about 33% from 46% earlier Tuesday.
The shift seemingly occurred after Hassett showed support for central bank independence on CNBC and said forging consensus is an important part of the job.
“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,” he said. “So the way you’ve got to drive interest rate movements is with consensus based on the facts and the data.”
Hassett’s odds took a dip earlier after fresh pushback from high-level figures with direct access to the president, according to people familiar with the matter. Those advisers have raised concerns that Hassett, currently director of the National Economic Council, is seen as too close to Trump.
Warsh, a former Fed governor who served from 2006 to 2011, has long been viewed as a credible pick for Republicans. Hassett has been a fixture of Trump’s economic team across both terms, a proximity that some advisers now fear could undermine the Fed’s institutional standing.
The race for Fed chief opened up after Trump injected new ambiguity into the race late last week. After previously telling reporters he already knew whom he would choose as Fed chair, Trump told the Wall Street Journal on Friday that Warsh had risen to the top tier of contenders.