Kevin Warsh, nominated by US President Donald Trump to become the Chair of the Federal Reserve, has been confirmed by the US Senate Banking Committee, moving one step closer to succeeding Jerome Powell, whose term ends May 15, 2026 [1][2][3]. The committee vote was split 13-11, with all Republicans supporting Warsh and all Democrats opposing him, marking the first fully partisan vote on a Fed chair nominee in the committee's history, according to Senator Elizabeth Warren [1][2][3].
Warsh's nomination had been delayed due to Senator Thom Tillis's opposition, which was tied to a Justice Department investigation into Powell's testimony regarding a costly renovation project at the Fed. Tillis viewed the probe as a threat to the central bank's independence. The investigation, led by U.S. Attorney Jeanine Pirro, was closed on Friday, with the Fed's inspector general, Michael Horowitz, taking over. Tillis subsequently lifted his opposition, stating, "I've got confidence that this investigation is over" [2][3].
Democrats, led by Senator Warren, strongly criticized Warsh's nomination, arguing it would erode the Fed's independence and allow President Trump to exert undue influence over monetary policy. Warren described Warsh as "uniquely unfit" and accused him of lacking independence from Trump, stating, "Mr. Warsh is a sock puppet who is so cowed by the president that he could not even say that Donald Trump lost the 2020 election" [2][3]. Warren also warned that advancing Warsh's nomination would bring Trump "one step closer to completing his illegal attempt to seize control of the Fed and artificially juice the economy" [2][3].
The committee's decision came hours before the Fed was set to deliver its latest interest rate decision, possibly for the last time under Powell. The central bank is expected to maintain its cautious approach, with sticky inflation, a stable labor market, and Iran-war-related price shocks keeping further rate cuts unlikely. This cautious stance has been a source of friction between Trump and Powell, with Trump criticizing Powell for not cutting rates as aggressively as he desires [3].
Warsh, a former Fed governor who served from 2006 to 2011, must now be confirmed by the full Senate before officially succeeding Powell [2].
CONCLUSION
Kevin Warsh's nomination for Fed Chair has cleared a major hurdle, advancing to a full Senate vote after a highly partisan committee decision. The event underscores deep political divisions over the Fed's independence and future direction, with significant implications for US monetary policy and market stability. The outcome of the final Senate vote will be closely watched by financial markets.