Republican Senator Thom Tillis stated on Sunday that he will allow the Senate to proceed with the confirmation process for Federal Reserve Chair nominee Kevin Warsh, following the Justice Department's termination of its investigation into current Chair Jerome Powell last Friday. Tillis had previously viewed the investigation as a threat to the Fed's political independence.
Tillis had earlier vowed to block any Fed nominations as long as the investigation remained active. "I am prepared to move forward with Mr. Warsh's confirmation process," said Tillis, a Republican from North Carolina. "I believe he would make an excellent Federal Reserve Chair."
This decision ends months of uncertainty for Warsh and clears the way for his Senate confirmation before May 15, when Powell's term as Chair concludes.
In January, Powell disclosed that the Justice Department had launched a criminal investigation into his oversight of a $2.5 billion renovation of two Federal Reserve buildings in Washington. In a candid video released Sunday evening, Powell characterized the probe as intimidation and part of the Trump administration's efforts to pressure the Fed into lowering interest rates.
In March, a federal judge dismissed the Justice Department's subpoena, ruling that its purpose was to compel Powell to either cut rates or resign, which was improper. U.S. Attorney Jeannine Pirro had indicated she would appeal and, as recently as last week, publicly stated the investigation would continue.
However, on Friday, she announced on platform X that she would terminate the investigation and request that the Fed's internal inspector general take over, as the latter has already been conducting an independent review of the renovation project for several months.
Tillis's objections were never directed at Warsh personally; during Tuesday's confirmation hearing, he described Warsh's qualifications as "impeccable."
Warsh, who served as a Fed Governor from 2006 to 2011, has pledged to overhaul the Fed's monetary policy approach and enhance cooperation with the Treasury and other government agencies on non-monetary policy matters.
During the hearing, he told lawmakers that former President Trump did not seek any commitment from him to lower interest rates. However, he also stated he was not concerned that tariffs would cause inflation and suggested that Fed policymakers might be using inflation metrics that overestimate price pressures.
With Tillis's support, Republicans on the Senate Banking Committee now hold a majority sufficient to overcome unified Democratic opposition and advance Warsh's nomination to the full Senate, where Republicans are expected to confirm his appointment.
With approximately three weeks remaining until Powell's term ends—including one week of scheduled Senate recess—the timeline is tight. The Senate has only once before confirmed a Fed nominee in less than three weeks.
Powell has stated that if Warsh is not confirmed by May 15, he will serve as interim Chair.
Should Warsh assume the role of Fed Chair, Powell could potentially remain on the Board as a Governor, as his term still has about a year and a half remaining. "I have no intention of leaving the Board until the investigation is fully concluded, with transparent and final results," Powell said last month.
Pirro noted on Friday that she might reopen the investigation depending on the findings of the inspector general's review. Senate Democrats Elizabeth Warren of Massachusetts and Dick Durbin of Illinois described this statement on Friday as a threat of "future unwarranted investigations" against Powell or any other Fed Governor.
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