Kevin Warsh will face the Senate next week
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Federal Reserve chair nominee Kevin Warsh. Photo: Tierney L. Cross/Bloomberg via Getty Images
There is new progress on getting Kevin Warsh, President Trump's pick to lead the Federal Reserve, confirmed to the post.
- The Senate Banking Committee will hold a hearing on his nomination next week, Sen. Tim Scott (R-S.C.), who chairs the committee, confirmed in a Tuesday morning interview with Fox Business.
- Warsh has submitted his financial disclosure forms, a key step in the confirmation process. They point to a net worth in the nine figures, which would make him the wealthiest Fed chair on record — even before accounting for the family fortune of his wife, cosmetics heiress Jane Lauder.
- The clock is ticking: Chair Jerome Powell's term is up on May 15. Powell has said he would continue acting as chair if his replacement is not yet confirmed.
Yes, but: Still unresolved is whether Warsh will make it to a full committee vote.
- Sen. Thom Tillis (R-N.C.) has vowed to withhold confirmation until the Department of Justice's Powell investigation is resolved.
- The margins are slim; Warsh's nomination cannot advance through the committee without Tillis' vote, assuming all Democrats vote no. The DOJ vowed to appeal the judge's latest ruling to quash its subpoenas.
What they're saying: "I believe that the DOJ will finish and wrap this up in the next several weeks, and Thom Tillis will be a yes on Kevin Warsh," Scott said in the Fox Business interview.
- Bessent told reporters Tuesday morning that "I think Sen. Tillis, at the end of the day, is a reasonable man."
- Asked whether the Trump administration would be OK with Powell staying on as head of the central bank beyond his term's expiration, Bessent said, "We want Kevin Warsh in as soon as possible."
Zoom out: The Treasury secretary, who spoke to a group of reporters following a talk at the Institute of International Finance's spring meetings event, said that he still thought the Fed should cut interest rates, but understands why officials are in pause mode.
- "I believe that [the Fed's] framework had been wrong, I believe it will be proven wrong — but if they want to wait for some clarity, I understand that," Bessent said.
- "The other thing is that I think we should wait for the new chairman, Warsh, and let him lead the next cycle."
The bottom line: While Trump will be certain to pressure Warsh to cut rates, the new Fed chair would face a challenging economic backdrop, with war-related inflation risks.
- Bessent said that he believes the U.S. "will cycle through very quickly," given that the government has held off on subsidies to offset the pain and the lack of evidence that energy pressures are passing through to underlying inflation.
- Bessent said that the International Monetary Fund's latest forecasts are backward-looking.
- "They probably overreacted, but we'll see," he said.
