President-elect Donald Trump indicated privately that he favors retaining Kevin Hassett as his chief economic advisor, while odds for former Federal Reserve Governor Gary Warsh becoming Fed Chair rose to 60% following the statement.
- Trump privately favors retaining Kevin Hassett as top economic advisor.
- Gary Warsh’s odds of becoming Fed Chair rose to 60% from 35% in one week.
- Hassett previously served as Chair of the Council of Economic Advisers under Trump.
- Warsh is known for advocating tighter monetary policy and central bank transparency.
- S&P 500 declined 0.8% and 10-year Treasury yields climbed to 4.22% following the news.
- No official White House statement has been issued on leadership decisions.
President-elect Donald Trump has privately signaled his preference to retain Kevin Hassett as his top economic advisor, according to multiple sources familiar with the discussions. While no formal announcement has been made, the indication comes amid growing speculation about leadership changes within the Federal Reserve ahead of Trump’s second-term inauguration in January 2025. The shift in sentiment is reflected in updated betting odds, which now place Gary Warsh—former Federal Reserve governor and a known fiscal hawk—at 60% probability of being nominated as Fed Chair, up from 35% a week prior. Warsh has previously advocated for tighter monetary policy and greater transparency in central banking, aligning with key policy priorities of Trump’s economic team. Hassett, who served as Chair of the Council of Economic Advisers during Trump’s first term, remains a central figure in shaping the administration’s economic agenda. His continued presence could signal a focus on pro-growth tax policies, deregulation, and sustained pressure on inflation targeting. The White House has not commented on internal deliberations, but advisors close to Trump confirm that Hassett’s strategic influence is being assessed against broader fiscal objectives. The potential appointment of Warsh would mark a significant departure from the current Fed leadership, especially given the central bank’s recent focus on inflation moderation. Markets reacted to the developments with modest volatility: the S&P 500 dropped 0.8%, while 10-year Treasury yields rose to 4.22%, reflecting investor uncertainty around policy continuity.