U.S. President Donald Trump has once again emphasized that the next Federal Reserve chair must move quickly to cut interest rates. His comments come as crypto traders begin placing bets on how aggressively the Fed could ease monetary policy in 2026, a year when Trump is expected to gain greater influence over the FOMC.
In an interview with Politico, Trump stated that immediate rate cuts would be a key requirement for whoever replaces Jerome Powell. This reinforces his push for looser monetary policy as economic and political pressure builds.
Kevin Hassett, a strong advocate for rate cuts and a current White House economic advisor, is now the leading candidate to become the next Fed chair. According to Polymarket, there is a 77% probability that Trump nominates him. The president has also suggested that the official announcement could come in early 2026.
Trump has publicly referred to Hassett as a likely replacement for Powell, signaling that his choice may already be made. Hassett has repeatedly called for lower interest rates and recently argued that the Fed should implement a 25-basis-point cut at the upcoming FOMC meeting.
Trump’s nomination of a rate-cut supporter would give him more sway over the central bank. Three current Fed Governors—Chris Waller, Michelle Bowman, and Stephen Miran—have all shown openness to rate reductions. However, the incoming Fed chair will take Miran’s seat once his term ends in January. To secure a board majority, Trump would still need an additional appointment, as Powell’s board term runs until 2028. Powell could still resign after stepping down from the chair role, as has happened with previous Fed leaders.
Crypto traders are already forecasting how many cuts may occur next year. Polymarket data currently shows a 23% chance of three quarter-point cuts in 2026. There is also a 20% probability of four cuts totaling 100 basis points, followed by an 18% chance of five cuts and a 12% chance of even more aggressive easing.
Powell is expected to reiterate at the post-FOMC press conference that future rate decisions will depend on incoming economic data. The Fed will receive additional key data before the January meeting, including the October and November PPI inflation reports, scheduled for release on January 14.
Meanwhile, Fed chair frontrunner Hassett warned that it is “irresponsible” to outline a fixed six-month policy path in advance. Instead, he argued that the central bank should continue adjusting policy based on real-time economic indicators.
