Empowering the Fed: Hassett Champions Independence and Defends Chair Candidates Despite Trump Ties

National Economic Council Director Kevin Hassett, among the finalists for the Federal Reserve chair position, endorsed central bank independence during a CNBC interview on Tuesday. As President Donald Trump nears a decision on a successor to Jerome Powell, Hassett refrained from discussing his own candidacy but emphasized the need for consensus in managing interest rates.

“The Federal Reserve’s independence is really, really important, and the voices of the other people at the [Federal Open Market Committee] are important too,” he stated. “Driving interest rate movements requires consensus based on facts and data.”

Hassett had previously emerged as a frontrunner for the role following Powell’s nearing completion of his second term, but recent developments have shifted the spotlight to former Fed Governor Kevin Warsh, who gained traction after a recent interview with Trump.

Emerging concerns around Hassett’s candidacy have been reported, with sources indicating that some of the president’s advisers fear he might be perceived as too closely aligned with Trump. This perception could lead to concerns that he would prioritize the president’s wishes over the Fed’s dual mandate of maintaining stable prices and full employment.

In response to questions about his qualifications, Hassett argued that his close relationship with Trump should not disqualify him. “The idea that someone isn’t qualified for the job because they are a close friend who has worked well with the president is something that I think the President rejects,” he explained.

Despite having appointed Powell, Trump has frequently criticized the current Fed chair, urging for more aggressive interest rate cuts. While the Federal Open Market Committee has enacted three successive rate cuts since September, totaling 0.75 percentage points, the president remains unsatisfied with the pace. Notably, Governor Stephen Miran, a Trump appointee who joined the FOMC in September, has dissented on each reduction, arguing for more substantial half-point cuts.

This ongoing situation reflects the complex dynamics between the White House and the Federal Reserve, particularly as the nation navigates economic challenges. As developments unfold, Hassett’s candidacy and the direction of the Fed are likely to remain in the spotlight.

This story will be updated as new information becomes available.

Original Source: https://www.cnbc.com/2025/12/16/fed-chief-candidate-hassett-says-central-banks-independence-is-really-important-would-move-rates-by-consensus.html
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Publish Date: 2025-12-16 20:21:00