Senate confirms Kevin Warsh as Fed chair

Kevin Warsh was confirmed on Wednesday as the next chair of the Federal Reserve, placing a longtime central bank critic at the helm as policymakers confront persistent inflation pressures and growing political calls for lower interest rates.

The Senate voted 54-45 to approve Warsh, 56, in what was described as the most divisive confirmation vote ever for a Fed chair.

The vote was largely along party lines, with Pennsylvania Democrat Sen. John Fetterman joining Republicans in support of the nomination.

Warsh will replace Jerome Powell, whose term as chair expires Friday after leading the central bank since 2018.

Powell will remain on the Fed’s Board of Governors, where he still has two years left in his term.

Last month, Powell said he planned to stay at least until renovations at the Fed’s headquarters are completed.

The confirmation concludes a lengthy search process that began in mid-2025 and included nearly a dozen potential candidates, among them current Fed Governors Christopher Waller and Michelle Bowman.

Trump pushes for lower interest rates

Warsh takes over at a politically sensitive moment for the Fed, with President Donald Trump openly pressuring the central bank to lower borrowing costs.

Trump repeatedly criticized Powell during his tenure, arguing that the Fed maintained overly restrictive monetary policy.

Markets, however, have recently reduced expectations for interest-rate cuts following fresh inflation data showing price pressures remain elevated above the Fed’s 2% target.

Separate reports released this week indicated accelerating pipeline inflation pressures at their highest levels in more than three years, prompting some investors to even price in the possibility of another rate increase later this year.

Rep. French Hill, R-Ark., praised Warsh’s appointment and emphasized his focus on inflation control.

“Chairman Warsh has repeatedly emphasized the importance of placing affordability and price stability at the center of our economic agenda,” Hill said in a statement. “His commitment to disciplined monetary policy will help restore confidence in our economy and support long-term prosperity.”

Familiar face returns to the Fed

This marks Warsh’s second stint at the Federal Reserve. He previously served as a governor from 2006 to 2011, a period that included the global financial crisis and the Fed’s unprecedented emergency response measures.

During that period, the Fed expanded its balance sheet beyond $4 trillion through large-scale asset purchases known as quantitative easing.

Warsh later argued those programs had gone too far.

Since leaving the Fed, Warsh has remained a vocal critic of central bank policy.

In a CNBC interview last year, he called for “regime change” at the Fed.

He has also served as a lecturer at the Stanford Graduate School of Business and held positions on multiple corporate boards.

Warsh replaces Stephen Miran on the Fed board.

Miran, appointed in 2025 to complete the remainder of Adriana Kugler’s term, frequently dissented from Federal Open Market Committee decisions by advocating for larger and more frequent rate cuts.

Wealth and ethics scrutiny likely to follow

Warsh is expected to become the wealthiest Fed chair in modern history, with personal holdings reportedly exceeding $100 million.

Under stricter ethics policies implemented following past controversies involving trading activity by Fed officials, Warsh will be required to divest many of his investments after assuming office.

His first meeting as chair of the Federal Open Market Committee is scheduled for June 16-17, where investors will closely watch for any signals on the future path of interest rates.