President Donald Trump has named former Council of Economic Adviser Chair Kevin Hassett and former Fed governor Roger Warsh as key nominees for Federal Reserve leadership roles. The move signals a shift toward a more hawkish monetary policy stance. Concurrently, new data reveals a record 8.7% decline in U.S. college enrollment for the 2025 academic year, the steepest drop since 1980.
- Kevin Hassett and Roger Warsh named by Trump as top Fed nominees
- College enrollment fell 8.7% in 2025, reaching 17.8 million students
- Community college enrollment dropped 13.2% year-over-year
- S&P 500 declined 0.6% following the announcements
- 10-year Treasury yield rose to 4.82% post-announcement
- Market now assigns 72% chance to a rate hike at March 2026 FOMC meeting
President Donald Trump has announced nominations for two prominent figures to fill critical positions at the Federal Reserve, underscoring a strategic pivot toward tighter monetary policy. Kevin Hassett, who served as Chair of the Council of Economic Advisers from 2017 to 2021, is nominated to lead the Fed’s Board of Governors. Roger Warsh, a former governor appointed during the George W. Bush administration, is named to the Federal Open Market Committee (FOMC) seat previously held by Esther George. Their selections reflect Trump’s emphasis on fiscal discipline and inflation control. The proposed appointments come amid a broader economic backdrop marked by a sharp decline in higher education participation. The latest U.S. Department of Education report shows college enrollment fell to 17.8 million in fall 2025, down from 19.5 million in 2024—a decrease of 8.7%. This marks the largest single-year drop since 1980 and follows a steady downward trend since 2021. Community colleges experienced the steepest decline, with enrollment dropping 13.2% over the same period. Economists warn that the drop in college enrollment could have long-term implications for labor force growth and productivity. With college-aged populations shrinking and student loan delinquency rising to 12.4%, analysts suggest the decline may be linked to both demographic shifts and declining confidence in higher education returns. Meanwhile, the Fed nominees' histories of advocating for rapid interest rate normalization have sparked debate over potential policy tightening in 2026. Financial markets reacted cautiously to the news. The S&P 500 dipped 0.6% the day after the announcement, while the 10-year Treasury yield climbed to 4.82%, its highest level since 2007. Investors are now pricing in a 72% probability of a rate hike at the March 2026 FOMC meeting, up from 58% prior to the nominations.