This is shaping up to be a momentous week for the Federal Reserve. What comes next for the Fed's leadership has come into clearer focus in the last three days, but one big question hangs over the institution.

The big picture: On Wednesday, the Senate Banking Committee is set to advance Warsh's nomination to lead the Fed, after Sen. Thom Tillis (R-N.C.) indicated his satisfaction with the Justice Department backing down from its investigation of Powell.

• That afternoon, Powell will conclude his 67th meeting presiding over the Federal Open Market Committee, then take questions from journalists at his 63rd post-meeting press conference.
• That will almost certainly be his final time for each. Warsh is on track to be confirmed by the full Senate by the time Powell's term as chair ends May 15 (or, at a minimum, by the next FOMC meeting in mid-June).
• Jeanine Pirro, the U.S. attorney for Washington, D.C., said Friday that she was handing off the investigation to the Fed's inspector general.

State of play: The question now is whether Powell will leave his seat as a regular Fed governor, which extends until Jan. 31, 2028.

• The modern tradition is for Fed chairs to step aside when their time in the top job expires. But Powell has held on to the possibility of staying — denying President Trump a vacancy for another 20 months — as a cudgel to defend the central bank's independence from political interference.
• "I have no intention of leaving the board until the investigation is well and truly over, with transparency and finality," Powell said in March.

The intrigue: Pirro said that she would "not hesitate to restart a criminal investigation should the facts warrant doing so."

• White House press secretary Karoline Leavitt on Friday said "the case is not necessarily dropped" but rather is being moved over to the inspector general.

Yes, but: Tillis is evidently satisfied that the DOJ investigation will only be reopened if the IG finds evidence of criminality tied to the Fed's over-budget $2.5 billion renovation project.

What they're saying: "I've had a number of conversations with the Justice Department," Tillis said on "Meet the Press" yesterday. "They have made it very clear that the current investigation is completely and fully ended."

• As the DOJ fights a federal judge's ruling that quashed its subpoenas of the Fed for being a pretext for political interference with interest rate decisions, Tillis said he has been assured that the appeal "is simply to challenge the basis for judging on the motion to quash the subpoenas," not a basis for reopening the investigation.
• "We worked a lot over the weekend to make sure that we were very clear that we had the assurances from DOJ that I needed to feel like they were not using the DOJ as a weapon to threaten the independence of the Fed," he said.

Of note: The Fed and Powell have not commented, though it will be hard to avoid doing so on Wednesday afternoon.

Between the lines: The Friday statements from Pirro and Leavitt sure didn't sound like the "transparency and finality" that Powell demands to step aside. The private assurances Tillis received point in the other direction.

• And there are other moving pieces that are relevant — particularly the Supreme Court's pending decision on whether Trump can fire Fed governor Lisa Cook, which could establish precedent for just how much he and future presidents can reshape Fed leadership at will.
• Powell could elect to stick around just long enough to see the further resolution of these crucial questions.

What's next: Tune in at 2:30pm ET Wednesday for Powell's final time at the lectern — and potentially an answer on his path ahead.

With all that changing of the guard and criminal investigation intrigue, it's easy to forget that there's a monetary policy decision on tap.

Driving the news: It is all but certain that the Fed's policy committee will leave interest rates unchanged following its two-day meeting, as it continues to reassess the outlook in light of the Iran war and resulting energy price surge.

• It would be the third straight meeting to leave rates on pause.

Zoom in: March headline inflation numbers surged, but that was overwhelmingly due to the energy price shock. Still, Fed leaders are on watch for evidence that the commodity price surge remains a one-off shift and does not spill over into a broader inflationary process.

• Further complicating things are that GDP growth and the labor market look relatively solid through the first four months of the year, or at least giving no clear signs of needing a boost from additional rate cuts.
• With Powell's chairmanship nearing its end, his words on what comes next may carry less weight than usual — but he can still give a read on sentiment among the other committee members whom Warsh will inherit.

What they're saying: "As many questions remain about the duration and potential escalation of the Iran War, its economic impact and potential lingering effects, the Fed will insist on maintaining maximum optionality in the fog of war, " Christopher Hodge and Selin Aker of Natixis said in a note.

• "We expect communication, from the official statement as well as the press conference, to stress that the Fed feels it is well-placed to address any future shocks," they add.