Kevin Warsh is poised to advance to a full Senate vote Wednesday after the banking committee backs Trump's pick to replace Jerome Powell at the Federal Reserve, setting up what appears to be a near-certain confirmation despite Democratic concerns about the central bank's autonomy.
All 13 Republicans on the Senate banking committee are expected to support Warsh when the panel votes at 10am EDT. The turnaround came after Senator Thom Tillis of North Carolina dropped his opposition once the Department of Justice ended a criminal investigation into Powell that he had viewed as threatening the Fed's political independence.
The 11 Democrats on the panel plan to vote against Warsh, citing doubts about his commitment to setting policy without regard to presidential pressure. Trump has repeatedly stated that Warsh will deliver the rate cuts he wants, and Warsh himself has promised "regime change" for the central bank.
The 56-year-old lawyer and former Fed governor faces little Senate resistance. If his confirmation follows recent timelines for Fed nominees, he could be sworn in by May 15, when Powell's term as chair ends.
What remains uncertain is whether Powell will leave the Fed entirely or stay on as a board member. Powell's seat runs through January 2028, and while Fed chairs typically step down to make room for successors, Powell has signaled he may remain if he believes it serves the institution and the country. He previously stated he would not leave until the criminal investigation ended with finality, viewing the probe as political intimidation aimed at influencing Fed policy decisions.
The US attorney for the District of Columbia, Jeanine Pirro, said Friday she would not hesitate to reopen the investigation should circumstances warrant. Senate Democrats Elizabeth Warren and Dick Durbin called that statement a threat of "future baseless investigations" targeting Powell or other Fed governors.
Powell is currently leading what is likely his final policy meeting as Fed chair. Markets expect the federal open market committee to hold its benchmark overnight interest rate steady in the 3.50 to 3.75 percent range, citing persistent inflation and upward price pressure from global oil supply disruptions related to the Iran war.
Author James Rodriguez: "The White House is making no secret of its desire to reshape the Fed, and Warsh's confirmation removes the last real institutional check on that ambition."
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