Trump picks ex-Fed insider Kevin Warsh to lead US central bank

WASHINGTON: Former Federal Reserve Governor Kevin Warsh has been nominated by US President Donald Trump to head the country’s central bank after Jerome Powell’s term ends in May, giving the frequent Fed critic an opportunity to push his vision of monetary policy “regime change,” officials said on Friday.

Trump, in a social media post, described Warsh as one of the “GREAT Fed Chairmen, maybe the best,” praising his experience and saying he would not disappoint. The nomination now awaits Senate confirmation.

Warsh, 55, served as a Fed governor from 2006 to 2011 and has publicly advocated for steep interest rate cuts, slimming the central bank’s balance sheet, and easing bank regulations. A Stanford Hoover Institution fellow and Wall Street veteran, Warsh has been a long-time Trump confidant and guest at the president’s Florida estate.

The nomination faces potential hurdles in the Senate, where Republican Senator Thom Tillis has stated he will oppose any Fed nominee until the Justice Department’s criminal inquiry into Powell is fully resolved. With Democrats likely to oppose Warsh as well, his confirmation could be delayed. Other Republicans, however, have expressed support, saying Warsh is well suited to guide the Fed and protect its independence.

Markets responded cautiously to the announcement, with global stocks edging higher, the dollar rising, and gold prices dropping. Analysts noted Warsh may support lower rates but is unlikely to pursue the aggressive easing some other candidates had proposed.

Trump’s nomination of Warsh concludes months of public auditions in which Warsh, White House economic adviser Kevin Hassett, Fed Governor Christopher Waller, and Wall Street expert Rick Rieder promoted their credentials and economic philosophies.

Warsh was previously considered for the role in Trump’s first term but was passed over in favor of Powell. He has consistently criticized the Fed for its balance sheet policies and interest rate decisions and believes productivity gains driven by artificial intelligence warrant sharper interest rate cuts.

His nomination comes as the Fed holds its benchmark rate at 3.50–3.75 per cent after three cuts in 2025, with markets not expecting further reductions before the June 16–17 meeting, when Warsh is expected to assume leadership.

Warsh’s ties to Wall Street, including his work managing investments for Stanley Druckenmiller, and family connections to Trump supporter Ron Lauder, place him under close scrutiny to demonstrate independence from political influence.