Kevin Warsh sworn in as new US Fed chair | Business and Financial Issues

Warsh will lead the central bank at a time when his independence has come under scrutiny amid political turmoil.

Kevin Warsh has been sworn in as the new chairman of the United States Federal Reserve Board of Governors, in his place. Jerome Powellwho has been in this position since 2018.

Warsh was sworn in Friday, following a contentious election period, with the Senate voting unanimously on his confirmations to the Board of Governors and as chairman. Only Pennsylvania Senator John Fetterman broke with his Democratic colleagues to advance his nomination.

Warsh, 56, he will head the central bank at a time when his independence has been highlighted among political parties that were not political.

The President of the United States Donald Trump, aware of this criticism, in his opening speech said, “I want Kevin to be independent and to do a good job.”

During his confirmation hearing before the Senate Banking Committee, ahead of a full Senate vote, Democratic Senator Elizabeth Warren accused Warsh of being Trump’s “sock puppet.” Warsh denied the allegations and said he would remain independent in his financial decisions.

When Joe Biden was president, Warsh advocated against lowering interest rates, but changed his tune after Trump took office. In December 2025, Trump said he would appoint someone to lead the central bank who agreed with him on rate cuts.

Regardless, Warsh cannot make political decisions unilaterally. He is one of the 12 members who voted.

Warsh’s first policy meeting will be held on June 16-17.

Pricing problems

The push from the White House to lower rates comes amid rising inflation in the US economy.

Buyer prices went up 0.6 percent in April after rising 0.9 percent in March, according to the latest Consumer Price Index report released by the Labor Department’s Bureau of Labor Statistics earlier this month.

On a year-over-year basis, prices were also up, up 3.8 percent compared to the same month in 2025, marking the biggest increase in three years. The biggest increase has been electricity prices, which jumped 17.9 percent last year.

US consumers are feeling the pressure at the pump. The average price of a gallon of gasoline (3.78 liters) is $4.56, according to the American Automobile Association (AAA), which tracks fuel prices daily. This is up from $2.98 per gallon on February 28, when the US and Israel first struck Iran.

Warsh, after being sworn in, said he was “not shy” about the problems facing the US economy and that inflation could be low and growth strong.

A rise in interest rates would keep the central bank from cutting rates. Analysts at JPMorgan Chase predicted last month that rates would remain unchanged until mid-2027 and expected that, by then, rates would rise rather than be cut.

“With inflation rising more than 2 percent in the last five years, and the increase in inflation is likely to occur due to the conflicts in the Middle East, and due to price pressures in several groups that do not seem to be related to prices or energy prices, the staff noted that inflation will be more persistent than expected as part of the mid-April meeting that was released.

The CME Group’s FedWatch tool, which tracks the likelihood of monetary policy decisions, says there is a 97 percent chance that rates will remain unchanged at the next policy meeting.