by Enoch Mwathwa
Former Federal Reserve Governor Kevin Warsh has moved into the lead to replace Jerome Powell as the next Fed chair. His rise follows growing resistance to Kevin Hassett’s candidacy inside Donald Trump’s advisory circle. Prediction markets now show a tight race, yet momentum has shifted fast. As debate over rates and independence intensifies, the choice could shape U.S. monetary policy for years.
Prediction Markets Flip as Warsh Gains Momentum
Odds moved sharply over the past week. Polymarket data now gives Warsh a 46% chance of nomination. Hassett sits close behind at 44%. Earlier this month, Hassett dominated with odds above 85%. That reversal reflects a clear change in sentiment.
Kalshi traders echo the same view. The platform shows Warsh at 52%. Hassett trails again at 44%. Traders reacted after Trump told the Wall Street Journal that Warsh ranked high on his shortlist. That comment carried weight across markets.
Moreover, Warsh impressed Trump during a recent interview. Advisors described the exchange as strong and direct. Soon after, reports surfaced of internal pushback against Hassett. That combination shifted expectations. As a result, Warsh now leads across major betting platforms.
Advisors Push Back as Fed Independence Takes Center Stage
Resistance to Hassett centers on optics and control. Some Trump advisors worry about his close ties to the president. They fear the relationship could weaken the Fed’s independence. That concern gained traction inside policy circles.
Hassett had benefited from that same relationship earlier. As National Economic Council director, he stayed visible and influential. He also signaled support for deeper rate cuts. That stance aligned well with Trump’s public demands.
However, the closeness now looks like a liability. Critics argue that the Fed must maintain a distance from political pressure. They see Warsh as a safer pick. He brings credibility from his past service at the Fed and private markets.
Trump has made one thing clear. Rate cuts matter. He said lowering rates stands as a key test for the next chair. On that front, Warsh fits well. Reports suggest he agrees with Trump on the need for easier policy. That alignment eases concerns that he would resist pressure.
Still, Warsh carries a different profile. He speaks often about long-term stability and credibility. He blends market experience with central bank discipline. Supporters say that balance strengthens his case.
Meanwhile, Hassett still has backing. His odds remain close. His policy views appeal to those who want faster stimulus. Yet the internal debate continues to shift.
The decision timeline remains unclear. Markets will watch closely for new signals. Each comment now moves odds and sentiment. For now, Warsh holds the edge. The final call could redefine the Fed’s path on rates, independence, and credibility.
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