The Senate confirmed Kevin Warsh as the next Federal Reserve Chair on May 13, on a 54-45 vote that fell almost entirely along party lines (only Sen. John Fetterman crossed over). Warsh — a former Fed governor, lawyer, and financier — took over from Jerome Powell when Powell’s term as chair expired May 16. He was separately confirmed to a seat on the Fed’s governing board the day prior.
Warsh has been a longtime Fed critic, arguing the central bank has strayed too far from its core inflation-and-employment mandate into issues like climate and inequality. Republicans praised his market experience and conservative outlook. Democrats raised concerns about Fed independence, pointing to Warsh’s hedging during his confirmation hearing on whether he would resist political pressure.
One notable wrinkle: Powell declined to resign from the board despite the customary norm of departing chairs stepping down when successors take office. Powell has said he will remain a board member until he is satisfied that the DOJ’s now-dropped criminal investigation into him is fully resolved. He can remain on the board until early 2028. The Trump administration has called this a violation of Fed norms.
Outlook: Warsh is expected to be more accommodating of rate cuts and less inclined toward stress-test-based capital requirements than Powell. Watch for signals on the regulatory capital front and how the new chair navigates the Fed’s independent supervision role under a politically assertive administration. The lingering Powell question — whether a former chair retaining a board seat creates meaningful friction — is worth monitoring for its effect on Fed decision-making over the next year.
Fed press release: https://www.federalreserve.gov/newsevents/pressreleases/other20260522a.htm