The Powell era may be accelerating towards its end, but the real interest rate game is actually lurking within the 18-member Federal Reserve decision-making committee. Even if Trump successfully nominates a new chair, this power struggle has only just entered a new phase.

Many traders focus only on the chairperson selection, but they actually miss the key—

First, the new chair’s actual power is far less than imagined. One person cannot act unilaterally; they must gain the support of the majority of the committee. This means every step of monetary policy involves internal negotiation and bargaining, with no absolute one-man rule.

Second, the hawkish forces have quietly regained strength. Recent economic data simply cannot support expectations of rapid rate cuts, and there is astonishing resistance within the committee against continuing easing. This directly impacts the overall interest rate trajectory through 2026.

There’s also a factor many overlook—the regional Federal Reserve banks hold crucial voting rights. The five members rotating in each year can fully influence decisions at the Washington headquarters. Sometimes, these five votes are enough to reverse the situation.

Trump is also not sitting idle. Next year, he is expected to continue nominating new board members, gradually shaping the overall direction of the committee. But this process is slow, far from an overnight change.

So traders need to understand that true monetary policy has never been decided by one person alone. Every seat on the FOMC committee could be the key vote that changes the interest rate trajectory. To predict the market trend in 2026, instead of guessing the chair’s inclination, it’s better to focus on how the power balance among these 18 individuals tilts.