Special Topic: Trump Formally Nominates Warsh for Fed Chair On December 10, 2025, in Washington, D.C., Federal Reserve Chair Jerome Powell responds to questions from reporters during a press conference following a Federal Open Market Committee meeting. The Fed announced a 25 basis point cut to the benchmark interest rate, bringing it to a range of 3.5%–3.75%, marking the central bank's third rate cut of the year. A strategist indicated that President Donald Trump's nomination of Kevin Warsh for Federal Reserve Chair has reduced the likelihood of Jerome Powell remaining at the Fed after his term as Chair concludes in May. Historically, Fed Chairs have typically resigned from their positions on the Board upon stepping down. However, with the Fed's independence currently under scrutiny from various quarters, Powell has repeatedly declined to comment on whether he will follow the customary practice of departing after his chairmanship ends. Should Powell intend to stay, his term as a Fed Governor still has two years remaining. Nevertheless, Warsh has consistently emphasized the importance of Fed independence and has shown significant concern regarding risks to price stability; his nomination could potentially alter the overall dynamics concerning Powell's potential retention. Peter Corey, Chief Market Strategist at Pave Financial, wrote: "Even during the global financial crisis, he consistently believed the balance of risks tilted towards price stability (holding this view in March 2008, the month Bear Stearns collapsed, as well as in June and September), yet he never dissented against any FOMC decision. In the third quarter of 2009, he also expressed concerns that a surge in credit could trigger inflation issues; furthermore, he was a staunch opponent of quantitative easing." Corey stated: "In my view, the probability that Powell feels he must remain has significantly diminished."
Comments