Rick Rieder, an executive at BlackRock, is being viewed as a strong contender for the role of Federal Reserve chair as President Donald Trump prepares to make his nomination to succeed Jay Powell, whose term ends in May. According to the prediction market Polymarket, Rieder’s probability of being selected has surged from 6% to 47% within a week, reflecting speculation that Trump will favor a candidate with Wall Street ties.
Rieder has been a key figure in financial markets, overseeing BlackRock’s $2.4 trillion bond strategies and previously working at Lehman Brothers for two decades. His rising odds represent a shift in the nomination landscape; previously, White House economic adviser Kevin Hassett was seen as the frontrunner but has lost favor amid concerns regarding his potential to compromise Fed independence.
Recent turbulence surrounding Powell’s testimony, which is under criminal investigation by the Department of Justice, has fueled skepticism among some Republican senators about the appropriateness of Hassett’s endorsement. They worry he may be too amenable to Trump’s influence on the Federal Reserve.
While Rieder has political donations supporting Democratic candidates, including notable figures like Cory Booker, some investors believe he could prioritize the Fed’s independence. Describing Rieder as a pragmatic rather than an ideological candidate, industry sources argue that he would be a favorable choice for maintaining a market-friendly approach to monetary policy.
As Trump considers his options, he made it clear he hopes Hassett remains in his current role at the White House, emphasizing the importance of any announcement regarding the Federal Reserve chair position.
Why this story matters
- The selection of a new Fed chair could significantly influence U.S. economic policy, affecting interest rates and market stability.
Key takeaway
- Rick Rieder’s rising candidacy reflects broader concerns about Federal Reserve independence amid Trump’s previous conflicts with current chair Jay Powell.
Opposing viewpoint
- Critics suggest that Rieder’s past political donations to Democrats may compromise his objectivity as Fed chair, raising questions about his potential alignment with the Trump administration’s economic strategies.
