BlackRock’s Rick Rieder’s bid to be the next Federal Reserve chair has gained momentum recently, people familiar with the matter said, as President Donald Trump weighs a congressional backlash in an attempt to put a friendlier face at the helm.
Trump’s interview with Reade on Thursday went well, people familiar with the matter said, requesting anonymity to discuss private deliberations.
Key senators including Republican Banking Committee member Thom Tillis have warned that Trump’s picks for the Federal Reserve will come under increased scrutiny after the Justice Department subpoenaed the Fed last week over Chairman Jerome Powell’s comments about a renovation project at the Fed’s headquarters. But Powell, whose term expires in May, claimed the criminal investigation was an excuse to punish him for not cutting interest rates quickly enough.
Read more: Fed receives DOJ subpoena; Powell vows to stand firm
Asked about the selection process on Friday, Trump said he had a candidate in mind but declined to name him. “I think I’ve done it — in my mind, it’s done,” he said.
Some people familiar with the matter said the current search involves four people, including Reid, National Economic Council Director Kevin Hassett, Fed Governor Christopher Waller and former Governor Kevin Warsh.
Read more: The volatile forces reshaping the Fed this year
Hassett was the early front-runner and remained the front-runner until Trump suggested this week that he might not want to lose Hassett’s current job. It was unclear whether this signaled a change in internal deliberations or an off-the-cuff remark.
“No one knows who President Trump will choose to be chairman of the Federal Reserve except President Trump himself. As the President has stated recently, he will announce his final decision soon,” White House press secretary Carolyn Leavitt said in a written statement on Saturday.
The decision to subpoena the Fed a week ago triggered a wave of backlash, and Tillis, a member of the committee that first considers nominees, has pledged to oppose any Fed nominations until the issue is resolved.
Reed, BlackRock’s chief investment officer for global fixed income, is considered likely to be easier to confirm, some people familiar with the matter said. A BlackRock spokesman declined to comment on Reid’s condition.
Hiring data released earlier this month showed that the labor market remains fragile at the end of the year and the hiring outlook remains cautious. Economists expect job creation to be limited and wage gains to slow this year, which could exacerbate voters’ concerns about affordability heading into this year’s midterm elections.
Fed officials have cut interest rates three times in a row through the end of 2025, but have said they are in no rush to cut rates again until they see more data on inflation and the labor market. Policymakers are expected to keep interest rates steady at their next meeting on January 27-28.
Reid called the Fed’s independence “critical,” but he also agreed with Treasury Secretary Scott Bessant that the central bank could be more “innovative” in the way it uses its balance sheet.