Overview
- Kevin Warsh, who is President Trump’s pick to lead the Federal Reserve, told the Senate Banking Committee on Tuesday that he would act independently and “not be a puppet,” hours after Trump said he wanted immediate rate cuts.
- Warsh said the president never asked him to set interest rates and he refused to promise cuts, saying decisions must follow the data and the Federal Open Market Committee’s debate and vote.
- Outlining a “change of regime,” Warsh proposed less public guidance about future rates, a review of the Fed’s eight-meeting-a-year schedule that by law could be as few as four, and new ways to track underlying inflation that strip out extreme price moves.
- He signaled openness to future cuts if productivity gains from artificial intelligence help restrain prices, and he has argued the Fed should shrink its roughly $6.7 trillion balance sheet.
- Senator Thom Tillis said he will block a floor vote until a DOJ investigation into Powell is resolved, raising the chance Warsh is not confirmed before May 15, when Powell has said he would remain as acting chair if needed.