Warsh moves to closer to Fed chair confirmation, advancing in Senate committee vote

Kevin Warsh, President Donald Trump’s nominee to serve as the 17th Federal Reserve chair, cleared the Senate Banking Committee on Wednesday in a 13-11 vote, moving him closer to confirmation before current Fed Chair Jerome Powell’s term expires May 15.

Warsh’s advancement came just hours before the Federal Open Market Committee (FOMC) finishes its two-day meeting and is expected to keep benchmark rates steady between 3.5% to 3.75%.

The earliest the full Senate could vote on Warsh’s nomination is the week of May 11, according to Reuters.

The Associated Press reported that Sen. Tim Scott (R-S.C.), chair of the Senate Banking Committee, said Warsh is “battle tested” and stressed the importance of breaking “the bind of Bidenomics on households across this nation.”

Sen. Elizabeth Warren (D-Mass.) said that Warsh’s nomination “will bring the president one step closer to completing his illegal attempt to seize control of the Fed and artificially juice the economy.”

The party-line vote came just a week after Warsh faced rounds of questioning from senators at his confirmation hearing. Warsh’s nomination had been delayed by Sen. Thom Tillis (R-N.C.), who pledged to block any nominees until the Department of Justice‘s probe into Powell — tied to alleged cost overruns on renovations at the Fed’s Washington, D.C., headquarters — was thrown out.

Jeanine Pirro, U.S. Attorney for the District of Columbia, announced last Friday that the investigation was being dropped.

Warsh, a former Fed governor and Morgan Stanley banker, is expected to face pressure from Trump on interest rates should he be confirmed. During his confirmation hearing, however, he rejected suggestions that he would bend to political pressure on interest rates, telling lawmakers he would not serve as Trump’s “human sock puppet.”

During the hearing last week, Democrats pointed to Trump’s repeated public calls for lower rates and questioned whether Warsh’s recent views on monetary policy align too closely with the president’s demands.

Lawmakers also scrutinized Warsh’s financial disclosures and his more than $100 million in investments, including stakes held through vehicles such as The Juggernaut Fund LP and THSDFS LLC. Warsh said he has agreed with federal ethics officials to divest “virtually all” of his holdings and move the proceeds into cash or Treasury bills if confirmed.

Republicans largely defended Warsh and focused on inflation, arguing the Fed made major policy mistakes following the COVID-19 pandemic. Warsh called for “fundamental policy reforms,” including shrinking the Fed’s balance sheet, along with relying more heavily on interest rates instead of asset purchases and reducing detailed forward guidance to financial markets.

The hearing underscored the political pressures surrounding the Fed as Trump has publicly demanded lower borrowing costs. Warsh maintained that Trump never sought commitments on future rate decisions and said he would have refused such requests if asked.