Trump says he is not weighing replacing Hegseth, and his leaving by year-end is a toss-up

President Trump said Wednesday he is not considering replacing Defense Secretary Pete Hegseth and praised his performance, ANSA reported. Traders now see it as a toss-up whether Hegseth leaves his post by the end of the year, after expectations briefly jumped to likely and then gave back the entire gain within hours.

The public endorsement is the likely reason for the reversal. It came amid reports that Trump had privately asked advisers whether Hegseth should stay. The timing makes it a plausible explanation, though the first precisely timed report found appeared shortly after the drop ended, so the link is not certain. Nothing in the available reporting explains the earlier surge.

The odds have been choppy for more than a week. In late October, Hegseth's departure was seen as unlikely. Expectations climbed in the last days of the month, slipped on Oct. 29, recovered the next day, and fell on Nov. 1 before rebounding on Nov. 2 and Nov. 3. Early Wednesday they edged up to a toss-up, then surged to likely around midday before falling back by the afternoon. The round trip took only a few hours.

Traders made a similar move on a related question, pulling back bets that Hegseth leaves the Trump administration before 2027 from likely to a toss-up. A combined bet on Brazil's Lula winning, Gadi Eizenkot becoming Israeli prime minister and Democrats winning the U.S. Senate also rose to a toss-up over the past day. That bet turns largely on election results rather than on Hegseth.

Hegseth has faced mounting pressure. In September, Republican Rep. Thomas Massie introduced articles of impeachment alleging, among other things, unauthorized hostilities in the Iran war. Democrats had introduced their own articles in April. On Oct. 28, Hegseth fired the Pentagon's top military planner. On Nov. 1, The Atlantic reported that Trump had questioned allies about Hegseth's performance. After Democrats won both chambers of Congress on Nov. 3, CBS News reported that Trump was asking advisers whether Hegseth should remain, while a White House spokesperson said he had the president's full confidence.

Trump's remarks are a more direct public statement of support, though they do not rule out a later change. The next test comes when the House returns after the midterms. Massie has said he plans to reintroduce impeachment articles. Impeachment alone would not remove Hegseth. An announcement before Dec. 31 that he is resigning or being removed would count, even if his departure took effect later.