Trump–Powell clash emerges as a variable in Warsh’s Fed chair confirmation

JH Kim

Summary

It reported that the clash between Donald Trump and Jerome Powell is delaying Kevin Warsh’s confirmation process for Fed chair.
It said a prolonged Fed leadership vacuum and extended confirmation uncertainty could increase uncertainty over the direction of monetary policy.
It reported that some analysts say without a clear exit strategy for the investigation into Chair Powell, Warsh’s confirmation process may also be hard to advance for the time being.

According to Walter Bloomberg, an economic news alerts account, on the 2nd (local time), tensions between U.S. President Donald Trump and Federal Reserve (Fed) Chair Jerome Powell are delaying the confirmation process for Kevin Warsh, the Fed chair nominee.

The outlet reported that as the Trump administration proceeds with an investigation into Chair Powell through the Department of Justice (DOJ), key Republican senators are signaling they will not cooperate with confirming a new Fed chair nominee until the probe is concluded. As a result, Warsh’s timeline to take office as Fed chair may be pushed back.

Markets are also watching whether the delay could weigh on President Trump’s push for interest-rate cuts. A prolonged leadership vacuum at the Fed or extended uncertainty around confirmation could heighten uncertainty over the direction of monetary policy.

Some analysts add that unless a clear exit strategy is laid out for the investigation involving Chair Powell, Warsh’s confirmation process may also struggle to make progress for the time being.