INSTANT VIEW-Trump names Warsh as next Federal Reserve Chair

LONDON, Jan 30 (Reuters) - U.S. President Donald Trump on Friday said he had picked former Federal Reserve governor Kevin Warsh as the next head of the Federal Reserve, when Chair Jerome Powell steps down in May.

The dollar trimmed its gains, while U.S. Treasury yields were higher and stock futures pointed to a weak open on Wall Street.

COMMENTS:

CHRIS BEAUCHAMP, CHIEF MARKET ANALYST, IG MARKETS, ENGLAND

"We will see from here because it's one thing to appoint somebody and it's an entirely different to actually be chairman of the Federal Reserve."

"The president wants low rates to be the main priority.... the problem is that it could be that his (Warsh's) position becomes just as difficult. The president doesn't change and it's recognition that the U.S. finds itself in a very difficult position right now in terms of inflation remaining stubborn, but economic data, as we should see in payrolls beginning to show signs of weakness with the unemployment rate moving higher."

KALLUM PICKERING, CHIEF ECONOMIST, PEEL HUNT, LONDON

"Warsh...is somewhat of a surprise pick, not being among the recently speculated frontrunners. That's why we got stocks and Treasuries coming back a little bit on the news earlier and the dollar picked up a little bit.

"In the end, I don't think that the whole debate around whether you get a hawkish or a dovish Fed chair matters as much as the market thinks. Mainly because I think the U.S. is going to see inflation mostly in the safe zone this year, which means the Fed should be free to focus on the employment side of its mandate."

"And so even if we would have got the dove or the hawk, in the end, the difference is their view on inflation, not whether or not they should support employment. My hunch is they're going to cut a little bit anyway just to try and support economic activity."

NICK KENNEDY, CURRENCY STRATEGIST, LLOYDS, LONDON

"Warsh is my preferred candidate but it didn't look promising for a while."

"From a policy perspective, his track record is more on the hawkish side and he is academically aligned with the administration on wanting a smaller balance sheet.

"In the interview process you have to be aligned with what Trump wants on policy rates. I don't think this is a role you would want to step into if you were in conflict with that."

"So, that idea that this is good for the dollar is going to be short-lived."