Trump picks Kevin Warsh to lead the Federal Reserve
Donald Trump is reportedly preparing to nominate Kevin Warsh, a former Fed governor, to be the next chair of the US central bank.
The announcement was expected Friday after Warsh's White House visit, shaking up financial markets—stocks dropped and Treasury yields climbed on the news.
Why does this matter?
Warsh is seen as likely to support interest rate cuts through 2026, which could influence financial markets.
Prediction markets quickly jumped in his favor, with odds above 85%.
Still, analysts say he might change course if inflation heats up again.
Who is Kevin Warsh?
Warsh was just 35 when George W. Bush appointed him to the Fed Board in 2006—the youngest ever for that role.
He previously worked at Morgan Stanley and was once passed over by Trump in favor of Jerome Powell back in 2017.
Interestingly, he now backs lower rates despite his earlier reputation as an inflation hawk.
Who's he replacing?
If confirmed by the Senate, Warsh will take over from Jerome Powell when his term ends in May 2026.
Trump has often criticized Powell for not cutting rates faster amid high inflation and trade tensions.
Other finalists included Kevin Hassett and Christopher Waller, but Treasury Secretary Scott Bessent led the search that landed on Warsh.