National Economic Council Director Kevin Hassett, one of the finalists for the Federal Reserve chair job, showed support Tuesday for central bank independence.
With President Donald Trump apparently in the final days of picking a successor to Jerome Powell at the Fed, Hassett declined in a CNBC interview to directly address his own candidacy but said forging consensus is an important part of the job.
“The Federal Reserve’s independence is really, really important, and the voices of the other people at the [Federal Open Market Committee], they’re important, too,” he said. “So the way you’ve got to drive interest rate movements is with consensus based on the facts and the data.”
Prior to last week, Hassett had been considered the leading contender for the job to take over for Powell, who is nearing the end of his second term as head of the central bank. However, Trump said last week that former Governor Kevin Warsh has come to the front of the pack as well, following an interview between the two last Wednesday.
There has been some pushback against Hassett in recent days. Sources told CNBC that the president’s advisors worry that Hassett will be perceived as too close to Trump and will do his bidding rather than seek to set interest rates in line with the Fed’s dual mandate of stable prices and full employment.
However, Hassett said his relationship with Trump shouldn’t be held against him.
“The idea that someone isn’t qualified for the job because they are a close friend who’s worked well with the president is something that I think the President rejects,” he said.
Though he appointed Powell, Trump has been a constant critic of the Fed chief.
Trump has demanded aggressive interest rate cuts, unsatisfied even as the FOMC has approved three consecutive cuts since September totaling three quarters of a percentage point. Governor Stephen Miran, a Trump appointee who came on board in September, has voted against each of those reductions in favor of half-point cuts.
Hassett stressed the need for consensus building at the Fed. Trump has advocated that the Fed should consult the president when making rate decisions.
“The way you’ve got to drive interest rate movements is with consensus based on the facts and the data,” he said. “When you get things wrong, you explain why and fix it. So that’s the way it moves forward. But the President is a seasoned observer of the economy, and if he has a good point, then I’m sure others will recognize it as such.”
Hassett and Warsh were part of five finalists for the job. Treasury Secretary Scott Bessent, who has been leading the process, said Tuesday morning on Fox Business that the decision likely will come in early January.