Key Points
- North Carolina Senator Thom Tillis withdrew his opposition to Kevin Warsh’s Federal Reserve chair nomination following the Department of Justice’s decision to conclude its investigation into Jerome Powell
- The Senate Banking Committee is set to conduct a confirmation vote on April 29, with full Senate consideration potentially occurring the week of May 11
- Jerome Powell’s term as Fed chair concludes May 15; Warsh may assume the position soon after Senate approval
- Financial markets indicate a 99% likelihood the Federal Reserve maintains its current 3.50%–3.75% rate range at the upcoming April 28–29 policy meeting
- Interest rate reductions aren’t anticipated before September 2027, based on CME FedWatch projections
Kevin Warsh has advanced significantly toward securing the Federal Reserve chair position following the removal of a critical Republican senator’s procedural block.
On Sunday, North Carolina’s Senator Thom Tillis announced his decision to support Warsh’s appointment. Tillis had previously stalled the confirmation proceedings due to an ongoing Department of Justice examination of current Fed Chair Jerome Powell concerning a billion-dollar Federal Reserve headquarters renovation project.
With the DOJ concluding its three-month investigation, Tillis withdrew his opposition. In a statement posted to X, he characterized the probe as “a serious threat to the Fed’s independence” and emphasized that its closure was necessary before he could endorse Warsh.
As a member of the Senate Banking Committee, Tillis’s support carries significant weight. The committee has scheduled its confirmation vote for April 29.
Following committee approval, the nomination advances to the complete Senate chamber. While no firm date has been established, floor proceedings could commence during the week beginning May 11.
Powell’s chairmanship officially expires on May 15. Should the Senate confirm Warsh, he could be sworn in shortly thereafter.
While Powell technically retains his seat on the Federal Reserve Board of Governors through 2028, historical patterns suggest he may opt to step down entirely when his leadership term concludes.
Federal Reserve Rate Expectations
Powell will preside over his final Federal Open Market Committee gathering as chair on April 28–29. Financial markets aren’t anticipating any policy shifts.
According to CME Group FedWatch indicators, there’s a 99% probability the central bank will maintain current interest rates within the 3.50%–3.75% corridor. The likelihood of a rate increase stands at merely 1%.
Deutsche Bank’s Chief Economist Matthew Luzzetti indicated the Fed’s messaging should remain aligned with policymakers’ intention to sustain current rates for a considerable duration.
Market pricing doesn’t incorporate rate decreases until September 2027. At that juncture, there’s a 38.6% probability rates could decline to the 3.25%–3.50% band.
International tensions, particularly the Iran situation, are creating additional economic pressure. Escalating energy costs are driving inflation upward, while uncertainty dampens corporate investment decisions.
Warsh’s Cryptocurrency Holdings and Monetary Policy Philosophy
Warsh has traditionally been characterized as a monetary policy hawk. This orientation generally favors prolonged elevated interest rates, which can negatively impact speculative assets such as cryptocurrencies.
Nevertheless, Warsh has recently stated the Federal Reserve will maintain its independence and that President Trump hasn’t exerted influence on him regarding interest rate determinations.
Regarding digital assets, Warsh revealed personal investments in more than 30 cryptocurrency initiatives, including Solana and the decentralized trading platform dYdX.
Warsh has also expressed skepticism about the Fed’s substantial portfolio of Treasury securities and mortgage-backed securities, a strategy implemented following the 2008 financial crisis.
The April 29 Senate Banking Committee vote represents the initial formal milestone in his confirmation process.
