The US Department of Justice's decision to drop its investigation into Federal Reserve Chair Jerome Powell has brought President Donald Trump's pick to lead the Fed, Kevin Warsh, one step closer to confirmation. Warsh, who has significant personal wealth, including investments in cryptocurrency, had been awaiting a Senate vote after a confirmation hearing. However, Republican Senator Thom Tillis had vowed to block the nomination as long as the DOJ pursued its probe into Powell over cost overruns in a Fed building project. With the investigation now dropped, the path to confirmation for Warsh has been cleared, and betting odds on his confirmation before May 15 have surged from 30% to over 80%.
The DOJ has asked the Fed's inspector general to investigate the matter and issue a report. US Attorney for the District of Columbia Jeanine Pirro stated that she will restart the investigation if the facts warrant it. Trump's ability to install his own nominee at the helm of the Federal Reserve would grant him greater influence over US monetary policy and leave him with more allies on the Fed board.
Senator Elizabeth Warren criticized the move, calling it an attempt to install Trump's 'sock puppet' as Fed chair, while Senator Tillis expressed his support for Warsh, calling him a 'great nominee'.