Weekly Comic: Markets in Suspense as Race for Fed Chair Enters Final Stretch

Investing.com – Market watchers continued to grapple with uncertainty over for interest rates.

President Donald Trump told reporters at the start of the week he is “very, very close” to deciding who should chair the Fed after interviewing five candidates for the position.

These include current Fed Chair Janet Yellen, whose term expires in February, as well as Fed Governor Jerome Powell, Stanford University economist John Taylor, Trump’s chief economic advisor Gary Cohn, and former Fed Governor Kevin Warsh.

The President on Tuesday had polled the Republicans on whether they would prefer Taylor or Powell for the job, and more senators preferred Taylor.

Taylor is seen as someone who may put the Fed on a path of faster interest rate increases compared to Yellen.

If Taylor is Trump’s choice, the most noticeable reaction will likely be felt in the bond market. Treasurys will sell off sharply, sending yields spiking violently higher as traders begin to price in a more rapid pace of Fed rate hikes.

Trump is expected to announce his Fed chair candidate before his Asian trip in early November.

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