WASHINGTON — Kevin Warsh told senators Tuesday he would maintain the Federal Reserve’s independence and make policy decisions based on economic data, as lawmakers pressed him on interest rates, transparency and potential conflicts of interest during his confirmation hearing to lead the central bank.
Warsh, nominated by President Donald Trump to succeed Jerome Powell, said he made no commitments to cut interest rates and emphasized that monetary policy would not be driven by political pressure, according to reporting by Reuters and the Associated Press.
He also outlined plans for what he described as “robust” reforms at the Fed, including revisiting its inflation framework and limiting forward guidance, while reiterating that decisions would remain data-dependent.
The hearing before the Senate Banking Committee comes as Warsh faces scrutiny from Democrats over his financial holdings and potential conflicts of interest, as well as broader concerns about political influence over the central bank, according to The Washington Post and Reuters.
Warsh pledged to divest significant assets if confirmed, but lawmakers questioned the lack of detail surrounding those plans and whether they could create ethical concerns. If confirmed, Warsh would be among the wealthiest Fed chairs in history, as the CU Daily reported here.
Additional Complication
The nomination is further complicated by an ongoing Justice Department investigation tied to the Federal Reserve, which has become a central issue in the confirmation process. Multiple news outlets, including Reuters and NPR, reported that Republican Sen. Thom Tillis has said he will place a hold on Warsh’s nomination until that investigation is resolved.
Tillis’ stance is significant given the closely divided Senate Banking Committee and could delay or block a confirmation vote, even as some Republicans have expressed support for Warsh’s qualifications.
The investigation, which involves scrutiny of the Federal Reserve and Powell, has cast a shadow over the proceedings and raised broader questions about the independence of the central bank, according to reporting by ABC News and American Banker.
Warsh declined to comment on the probe during his testimony but reiterated that maintaining the Fed’s credibility and independence would be central to his leadership if confirmed.
