Trump said he would announce his choice “some time next week”, ending weeks of speculation. Janet Yellen, the current chair whose term is due to expire in February, had been thought to be a contender, but reports emerged last night from US news site CBS stating that she was no longer in the running.
Trump said in the Instagram video that he had “someone very special in mind” who would “hopefully do a great job”.
People are anxiously awaiting my decision as to who the next head of the Fed will be....— Donald J. Trump (@realDonaldTrump) October 27, 2017
“I think everybody will be impressed, but most importantly at the end of eight years you will really be impressed,” he added.
He went on to praise the US economy, saying “things are looking good”.
Figures released yesterday showed the American economy has grown at a much faster rate than economists expected so far this year, expanding by three per cent in the year to September.
Read more: US GDP smashes growth consensus forecasts
Sources cited in US media have named hawkish Stanford University economist John Taylor or current Fed governor Jerome Powell as Yellen's most likely successor. Fed chairs, if deemed credible, can influence a wide range of government policies.
Powell would be seen as a stable choice, since he has never dissented from a majority Fed decision since his appointment to the board in 2012. Taylor might aim to shake things up a little more – although with the Fed having missed its inflation goal for the majority of the past five years, it seems unlikely he would propose any drastic changes to Yellen's slow and steady pace of rate hikes and balance sheet runoff.