Trump Administration's Fed Chair Selection Sparks Market Speculation

According to Foresight News, a report by CITIC Securities indicates that the Trump administration is currently in the process of selecting the next Federal Reserve Chair. The main contenders are believed to be Waller and Hassett, with the decision seen as a choice between the 'most suitable' and the 'most compliant' candidates for U.S. President Donald Trump. Market probabilities currently favor Hassett, but Trump's trust in Besant suggests that Besant's influence in the interview process could lead to unexpected outcomes. The report highlights the precedent of market reactions and the resistance faced by Trump's previous nominee, Milan, in the Senate, suggesting that Hassett's election is unlikely. Instead, Waller is expected to emerge as the winner, potentially leading to a 'loss of independence' scenario for the Federal Reserve. This could benefit overall U.S. dollar assets while negatively impacting gold, with the market possibly reducing expectations for interest rate cuts next year. If Hassett is chosen, it is anticipated that the market will react with a 'muscle memory' response to the perceived loss of Federal Reserve independence. This scenario could negatively affect U.S. dollar assets and benefit gold, with the market potentially increasing expectations for interest rate cuts next year.