Kevin Warsh wins Senate approval, moves closer to Fed chair role as Powell prepares Friday exit

Kevin Warsh has been confirmed by the Senate for a 14-year term on the Federal Reserve Board of Governors, marking a significant step towards potentially becoming the next Fed chair. The Senate voted 51-45 to confirm him, with a separate vote on his nomination for Fed chair anticipated soon. Warsh is expected to succeed Jerome Powell, whose term as Fed chair concludes Friday. Powell intends to remain on the Fed board after his tenure as chair, an uncommon decision influenced by legal and political pressures on the central bank. President Trump sees Warsh's confirmation as a clearer path to influence the Fed's direction, having previously advocated for lower interest rates and criticized Powell's approach. Warsh, who previously served as a Fed governor from 2006-2011, has promised independence and stated Trump has not predetermined any rate decisions. His return occurs during a complex monetary policy period, with Warsh advocating for a "regime change" at the Fed, including closer coordination with the Treasury and a smaller balance sheet to potentially lower interest rates. The Fed also faces rising inflation pressures due to oil prices and reduced expectations for rate cuts. Warsh's confirmation was delayed by a criminal probe into Powell's testimony regarding the Fed's renovation, which was dropped by the Justice Department last month but could be reopened. The upcoming Fed policy meeting on June 16-17 could be chaired by Warsh if confirmed for the leadership post, highlighting the significant influence of the chair role.

(Source：Crypto Briefing)