Trump announces final four candidates for Fed chair, with dovish positions raising concerns over politicization | crypto market follows interest rate policy shift

President Trump confirmed that the candidate list for the Fed Chairman has been narrowed down to four loyal supporters: Kevin Warsh(, Kevin Hassett), Christopher Waller(, and Michelle Bowman). All candidates support faster and larger interest rate cuts and are accused of catering to Trump for the nomination. This move deepens concerns in the market about the politicization of the Fed, which Wall Street is unhappy about. Meanwhile, board member Adriana Kugler( unexpectedly resigned, and Trump will fill the vacancy immediately. The crypto market is closely assessing the long-term liquidity effects that a dovish Fed Chairman may bring.

【Bescent exits, four individuals locked in the list】 Trump confirmed on CNBC's "Squawk Box" program that his formidable competitor Scott Bessent has withdrawn from the race. Bessent made it clear to Trump that he wishes to remain in his position at the Treasury, quelling rumors that he might take over the Fed. "I have a lot of respect for Scott, but he wants to stay in his current position," Trump said in a live interview. "I asked him last night, 'Is this the position you want?' (Scott replied), 'No, I want to stay in my current position.' He actually said, 'I want to continue working for you.' It’s a tremendous honor. I said, 'That’s great, I appreciate it.'

[Candidates' Positions are Distinct, Wall Street Worries about Politicization] Trump's final four candidates all support lowering interest rates and have each clearly expressed a willingness to cater to Trump in order to obtain the position. This clearly indicates that central bank decision-making is likely to shift towards politicization, causing unease on Wall Street. Two candidates, Waller and Hasset, have held senior economic positions and are sharp critics of the Fed's current policies. Waller previously served as a Fed governor. Hasset leads the National Economic Council and is one of Trump's closest economic policy aides. Both have publicly advocated for an earlier and more aggressive easing of monetary policy. The other two on the list, Christopher (Waller) and Michelle (Bowman), are current Fed governors who voted last month in favor of rate cuts, contrary to the decision of Chairman Jerome Powell and the majority who chose to maintain rates. Their dissent has attracted attention. Trump told CNBC: "Both Kevins are excellent, and there are others who are also great, such as governors Michelle and Christopher."

[Kugler's Unexpected Resignation Adds to Vacancies] A few days before Trump announced the final list, one of the Fed governors, Adriana Kugler), suddenly announced her resignation. Her resignation will take effect this Friday. This presents Trump with a new vacancy that needs to be filled immediately.

[Powell's Term and the Political Dispute over Interest Rates] Jerome Powell's term does not end until May 2026. However, it is well known that Trump has been openly criticizing him since last year, accusing him of delaying interest rate cuts to protect the Democrats. Trump even claimed that Powell assured him of loyalty. "Sir, I will keep interest rates very low. I am a low-interest-rate supporter," Trump said Powell told him this in 2017 (when he nominated him during his first term). The Fed's benchmark interest rate remained unchanged last week, currently at a range of 4.25% to 4.5%. The market expects a cut in September. Trump claimed that several recent rate cuts, especially a full percentage point reduction between September and December 2024, are aimed at helping Democratic presidential candidate Kamala Harris ( Kamala Harris ) with political maneuvering.

【Advance Layout? Market Prediction Update】 There are also rumors that Trump may appoint someone to secretly undermine Powell's authority before 2026. He did not deny this. When asked, he responded, "It's a possibility." The prediction market Kalshi updated the odds after Trump's comments. The probabilities of Haskett and Waller being chosen as chair both rose to 35%. Waller's chance dropped to 15%, possibly because Trump did not mention his name during the program. Judy Shelton, who served as an advisor during Trump's first term, received a 6% chance. David Malpass, who led the World Bank from 2019 to 2023, was given a 4% chance. Trump himself even received a 1% vote on Kalshi to lead the Fed. He previously joked that he could lead the central bank better than Powell. "If I wanted to do it myself, I could," he said.

Conclusion: Trump's preference for a dovish and loyal Fed chair candidate list has intensified market concerns over the independence of the central bank and the potential for political interference in its policies. With Kugler's unexpected resignation, Trump's control over the Fed will further strengthen. Crypto market investors are closely monitoring this key personnel change process and its potential impact on long-term accommodative monetary policy, assessing the macro policy basis for the future price trends of crypto assets such as Bitcoin. The risk of weakened central bank independence has become the biggest concern for the current market.