Senate confirms Kevin Warsh as next Fed chair after probe clears

Who is incoming Fed chair Kevin Warsh?

Kevin Warsh has been confirmed by the U.S. Senate to lead the Federal Reserve, replacing Jerome Powell as chair after a confirmation process that stretched through a politically charged legal dispute. The Senate’s May 13 vote put a former Fed governor at the helm of a central bank facing economic headwinds, including inflation pressure tied to the war that began Feb. 28 and has pushed up energy prices, AP reported.

The White House had said it wanted Warsh to pursue a policy path aligned with the rate cuts President Donald Trump has pressed for. In AP’s account, Trump picked Warsh to replace Powell, believing the former governor could deliver the strong economy Trump promised voters and that Warsh would be receptive to demands for lower interest rates.

Warsh’s confirmation also came as the Fed navigates a backdrop in which cooling inflation remains a central goal. AP reported that the Fed’s challenge is made harder by the conflict’s impact on energy prices, even as Trump has demanded lower interest rates rather than the higher ones that the Fed might need to keep inflation in check.

Delay tied to Justice Department investigation

Warsh’s confirmation was delayed, AP said, in part because the Justice Department launched an investigation that was widely seen as an effort to oust Powell. Sen. Thom Tillis, a Republican from North Carolina, said he would oppose Warsh until the investigation was dropped, a condition that AP said was ultimately met when the Justice Department ended the inquiry last month.

Tillis’s stance underscored how the confirmation became entangled with the broader fight over the Fed’s direction and the independence of the central bank. Trump had also attacked Powell for refusing the deep rate cuts he believes would boost the economy, according to AP.

Powell to stay on the board after term ends

In what AP described as an unusual move, Powell said he would remain on the Fed’s governing board indefinitely after Warsh comes on as chair, citing what Powell called “unprecedented” attacks on the central bank’s independence. Powell’s chair term is ending, but AP reported that his term as a Fed governor does not expire until 2028.

That extended presence could create practical tension for Warsh’s first stretch as chair. AP reported that Powell’s continued seat on the board could complicate efforts to persuade other Fed officials to align with rate cuts pressed by the White House.

Warsh’s policy track record and background

AP said Warsh had earlier positioned himself as an inflation hawk in his career, but more recently aligned himself with Trump’s view that technologies such as artificial intelligence and other advances can boost productivity and economic growth without igniting inflation. AP also traced Warsh’s earlier profile through his service: at age 35, he became the youngest governor on the Fed’s seven-member board, serving from 2006 to 2011.

Before joining the Fed, AP reported, Warsh worked as an economic aide in George W. Bush’s Republican administration and later worked as an investment banker at Morgan Stanley. AP also said he worked closely with then-Chair Ben Bernanke during 2008 and 2009 as the Fed responded to the financial crisis and the Great Recession.

Still, AP reported that Warsh appeared in key moments to be wrong-footed about the depth of the economic challenges during the Great Recession. AP said he wanted the Fed to keep benchmark rates higher when the economy faced risks of deflation and possible collapse, and that he raised concerns in 2008 about further rate cuts potentially spurring inflation.

AP also reported that Warsh objected in 2011 to the Fed’s decision to purchase $600 billion of Treasury bonds. AP said that while he initially opposed the move, he ultimately voted in favor of it at the time, following Bernanke’s request, according to AP’s account.

Relationship with Trump and disclosure issues

AP reported that Trump described Warsh as coming from “central casting,” a remark that AP said reflected the president’s views of the 56-year-old’s conventional pedigree. AP said Warsh has many trappings of a traditional pick for the world’s most important central bank, even as the moment for the Fed is unconventional, with Trump saying the new chair should cut benchmark rates to the White House’s liking.

Democrats in the Senate, AP reported, condemned Warsh for not fully disclosing details of his wealth, which they said amounts to at least $100 million. AP said Warsh’s investments include stakes in Polymarket and SpaceX, and that he had promised to sell all such assets within 90 days of being sworn in.

Warsh is also credited by AP with academic credentials from Stanford University and Harvard Law School and with being married to Jane Lauder, the daughter of billionaire cosmetics heir Ronald Lauder, a major Republican donor. AP further reported that Warsh worked as a visiting economics fellow at the Hoover Institution and as a lecturer at the Stanford Graduate School of Business, and that he is also a partner at the Duquesne Family Office.

In past public comments, AP said, Warsh criticized the Fed in interviews, including by calling for “regime change,” and he assailed Powell for engaging on issues such as climate change and diversity, equity and inclusion, which Warsh said are outside the Fed’s mandate.

As Warsh steps into the chair role, the political and policy strains around rate cuts and institutional independence are likely to remain central. Powell’s decision to stay on the board through 2028 and the timing of the cleared investigation mean Warsh’s confirmation arrives with both the operational challenge of managing inflation and the political challenge of navigating a Fed whose leadership is now more closely tied to White House demands.