Who Will Lead the Fed? Wall Street Veteran is the Strong Favorite to Become Fed Chair

Trump Advisor Kevin Hassett was previously considered the frontrunner to become the next Federal Reserve Chair, but now Wall Street veteran Rick Rieder is in the mix.

Prediction markets see a 50% chance that Trump will appoint Rieder to the powerful role.

But why does it matter, who’ll be the next Fed chair?

And who is Rick Rieder?

Let’s dive in…

Just a few months ago, Kevin Hassett was the obvious pick for the next Federal Reserve Chair.

He’s a well-known Trump advisor, and many thought he had it in the bag.

But the game has changed.

Now, Wall Street veteran Rick Rieder is in the running, and markets are giving him a solid 50% chance of landing the job.

Quick Reminder: What is The Fed?

In the U.S. the central bank is called the Federal Reserve - or simply, “the Fed.”

So, what do they actually do?

The Fed works under what’s called a “dual mandate”.

It’s responsible for keeping prices stable and making sure as many people as possible have jobs.

One of the ways the Fed can affect price stability is by adjusting interest rates - the cost of borrowing money - to cool things down or heat them up.

When inflation is high, the Fed raises rates to slow spending and bring prices under control.

When growth stalls, it lowers them to boost the economy by encouraging borrowing and investments.

In short, the central bank’s role is to make sure the economy doesn’t catch fire or freeze over.

Who is Rick Rieder?

Rick Rieder is no stranger to the financial world. He is, first and foremost, a Wall Street man.

As BlackRock’s Chief Investment Officer for Fixed income, he manages a mind-blowing $2.4 trillion.

His career includes leadership roles at Lehman Brothers (pre-crash) and founding R3 Capital Partners.

But it’s his approach to economic management that’s making waves in this race for the Fed Chair.

In an interview on Goldman Sachs’ podcast "Exchanges" in 2023, Rick Rieder described how, as an investor, it is essential to always navigate the changing market conditions and determine when to change course.

"I always say, when it comes to managing money, we are not in the business of being right. We are in the business of generating returns," he said.

In other words, if Rick Rieder takes the Fed Chair, he will likely be much more hands-on than theoretical.

This aligns with Donald Trump’s intense criticism of Jerome Powell and the Federal Reserve.

Trump has criticized the current Fed’s reluctance to lower rates.

Rick Rieder also stated that the U.S. labor market appears so weakened that the Fed should lower rates again in the near future.

Specifically, according to Rick Rieder, the Federal Reserve’s rate should be reduced to 3% instead of the current 3.5-3.75%. However, Fed Chairs tend to change their perspective once they’re in the role, which was the case with Powell. He was nominated by Trump in 2017 but has been more cautious.

What The Selection Timeline Looks Like

January → Spring

• Trump makes his final decision
• Formal nomination is sent to the Senate.
• Hearings begin

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May 2026

• Jerome Powell’s term officially ends.
• New chair takes over — unless the Senate blocks the nominee, which would trigger… more drama.

Will Rieder give Trump the big rate cuts he wants, then?

Rick Rieder has himself signaled the importance of an independent central bank.

He recently said in an interview with CNBC that, no matter who leads the Federal Reserve, they will "make the correct decisions for maximum employment and price stability" — the central bank’s two mandates.

Rieder was considered an outside bet for the role, in part because of political donations made to Democrats.

Public records show he donated to campaigns for leading Democrats, including Hakeem Jeffries and Cory Booker, along with Nikki Haley, Trump’s Republican rival in the 2024 presidential primaries.

Some investors, who have also raised concerns over Hassett’s candidacy because of his closeness to Trump, say Rieder would maintain the central bank’s independence to set interest rates free from political pressure.

The FOMC, which sets interest rates, consists of 12 members in total.

The Fed Chair is just one of the votes in the committee, which weighs the same, although the chairperson plays an important role in guiding the markets regarding the direction of rates.

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