Core Insights - The Federal Reserve is facing a challenging 2026 with mixed economic signals and a leadership change as President Trump prepares to appoint a new Fed chair [1][9] - Analysts predict that the Fed may lower interest rates a couple of times due to signs of a weakening economy, particularly highlighted by the November jobs report [1][4] - The internal dynamics of the Federal Open Market Committee (FOMC) will play a crucial role in shaping interest rate decisions, with potential divisions among members [3][9] Economic Indicators - The labor market is showing signs of softening, with unemployment rising to 4.6% in November and only 64,000 jobs added [4] - Despite this, consumer spending and investments in artificial intelligence are contributing to overall GDP growth, which may mitigate risks to the labor market [4] - Economic data is expected to become less supportive of lower rates by mid-2026, complicating the Fed's decision-making process [4] Leadership Changes - Trump's nominee for Fed chair is expected to be finalized soon, with potential candidates including Fed Governor Chris Waller, former Fed Governor Kevin Warsh, and economist Kevin Hassett [6][7] - Betting markets suggest that Hassett is the most likely pick, raising concerns about his alignment with Trump's aggressive interest rate cut agenda [7] - The new Fed chair will need to navigate a divided committee, as past votes indicate challenges in achieving consensus on rate cuts [3][9] Federal Reserve Structure - The FOMC consists of 12 regional district heads who provide local perspectives, and their appointments have been secured for the next five years, enhancing the Fed's perceived independence [17][18] - The influence of the administration on the FOMC is expected to increase as Trump may have opportunities to appoint additional members to the Fed's Board of Governors [13][14] - Powell's future as Fed chair remains uncertain, with his term ending in May 2026, but he may choose to remain on the board to reinforce the Fed's independence [15][16]

Kevin Warsh, former governor of the US Federal Reserve, speaks with CNBC on July 17, 2025.President Donald Trump said Friday that Kevin Warsh has moved to the top of his list as the next Federal Reserve chair, according to the Wall Street Journal.Previously considered on Trump's short list but not the favorite, Warsh, a former Fed governor himself, apparently ingratiated himself further following an interview Wednesday with the president."Yes, I think he is," Trump told the paper, according to an account po ...

U.S. stock futures were fluctuating on Monday after Friday’s advance. Futures of major benchmark indices were mixed.President Donald Trump's administration plans to unveil a long-awaited $12 billion financial rescue package on Monday aimed at U.S. farmers struggling under the combined weight of low market prices and the impact of tariff policies.Investors await a crucial decision from the Federal Reserve later this week, along with the earnings report of Oracle Corp. (NYSE:ORCL) , Broadcom Inc. (NASDAQ:AVGO ...