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Jerome Powell's chances of remaining Fed chair for a second term are slipping, according to betting markets.
Powell's chances fell from about 80% in August to 61% today, according to PredictIt.
The slide in the odds comes amid stock trading controversies for two Fed Governors.
Jerome Powell's chances of being confirmed by the Senate as Fed chairman for another term in 2022 are slipping, according to data from betting-markets website PredictIt.
Powell's chances have fallen from about 80% in August to 61% as of Monday morning. The sharp decline comes amid an ongoing stock trading controversy that has ensnared several Fed governors and led to the resignations of Boston Fed President Eric Rosengren and Dallas Fed President Robert Kaplan.
Annual financial disclosure forms found several Fed governors, including Powell, owned assets that the Federal Reserve was also buying as part of its COVID-19 stimulus program, including municipal bonds and treasuries.
On Friday, Bloomberg reported that Fed Governor Richard Clarida sold between $1 million and $5 million of bonds and used the proceeds to purchase stocks just one day before Powell issued a statement indicating a potential Fed policy change amid the beginning of COVID-19 pandemic last February.
The pressure on Powell mounted last week, with Senator Elizabeth Warren calling the Fed Chairman "a dangerous man" when it comes to his policies towards banks.
"Your record gives me grave concern. You have acted to make our banking system less safe, and that makes you a dangerous man to head up the Fed," Warren told Powell, adding that she will oppose his renomination.
Another Fed governor, Lael Brainard, is a favorite among progressives to succeed Powell. Her chances of becoming the next Fed Chair have surged on PredictIt to 24% from single digits in the past month.
Regardless, the uncertainty is sure to remain as investors look to sort out who will be next chair, Fundstrat's Tom Lee said in a Monday note. "Markets don't like uncertainty, so this will hang over markets for the next few months," Lee said.
Powell's term as Fed chair ends in February 2022, while his term as a Fed governor ends in January 2028.
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