Trump Picks Ex-Fed Kevin Warsh to Head Federal Reserve

WASHINGTON: US President Donald Trump has nominated former Federal Reserve Governor Kevin Warsh to lead the nation’s central bank after Jerome Powell’s term expires in May. This will give the frequent Fed critic a chance to advance his idea of monetary policy “regime change,” officials announced on Friday.

In a social media post, Trump praised Warsh’s experience and said he would not let him down, calling him one of the “GREAT Fed Chairmen, maybe the best.” The Senate must now confirm the appointment.

The 55-year-old Warsh, who was a Fed governor from 2006 to 2011, has openly supported drastic interest rate reductions, reducing the size of the central bank’s balance sheet, and loosening bank regulations. Warsh, a Wall Street veteran and fellow of the Stanford Hoover Institution, has long been a close friend and visitor to Trump’s Florida resort.

Potential obstacles to the nomination could arise in the Senate, where Republican Senator Thom Tillis has declared that he will not support any Fed nominee until the Justice Department’s criminal investigation of Powell is concluded. Warsh’s confirmation may be postponed because Democrats are expected to oppose him as well. However, other Republicans have voiced their support, claiming that Warsh is a good fit to lead the Fed and safeguard its independence.

The statement caused markets to react cautiously, with gold prices declining, the dollar strengthening, and global stocks slightly gaining. Although Warsh might be in favor of lower rates, analysts pointed out that he is unlikely to undertake the extreme easing that some other candidates had suggested.

After months of public auditions during which Warsh, Wall Street expert Rick Rieder, Fed Governor Christopher Waller, and White House economic adviser Kevin Hassett pushed their qualifications and economic ideologies, Trump finally nominated Warsh.

Warsh was previously considered for the post in Trump’s first term but was passed aside in favor of Powell. He has continuously criticized the Fed for its interest rate and balance sheet policies, and he feels that the productivity increases brought about by artificial intelligence call for more drastic interest rate reductions.

His nomination coincides with the Fed maintaining its target rate at 3.50–3.75 percent following three rate decreases in 2025. Before the June 16–17 meeting, when Warsh is anticipated to take over, markets do not anticipate any more rate cuts.

Warsh is under intense scrutiny to prove his independence from political influence because of his connections to Wall Street, including his job managing investments for Stanley Druckenmiller and his family’s relationship to Trump supporter Ron Lauder.