Overview
- Kevin Warsh is on track for Senate confirmation as Fed chair in mid May, while Jerome Powell plans to remain a governor through 2028.
- With only one vote on the 12-member Federal Open Market Committee, Warsh cannot deliver the June rate cut the president wants on his own.
- Market pricing shows investors see little chance of easing this year, with CME FedWatch putting rate-cut odds near 5.5% and a 2026 hike near 32%.
- Headline inflation in the Fed’s preferred PCE index climbed to 3.5% year over year in March as energy costs rose during the war with Iran.
- Warsh has signaled changes to Fed practice, including scaling back the dot plot and favoring trimmed-mean inflation gauges, but recent data and board dynamics point to a cautious start.