The Trump administration has moved a step closer to exerting greater control over the US financial system after the Department of Justice dropped its investigation into Federal Reserve Chair Jerome Powell. This development may pave the way for the confirmation of Kevin Warsh, Trump's nominee to replace Powell, who has been awaiting a Senate vote after a recent confirmation hearing. The investigation, which was related to cost overruns in a Fed building project, had been a stumbling block for Warsh's nomination, with Republican Senator Thom Tillis threatening to block the confirmation as long as the probe was ongoing. However, with the DOJ now passing the matter to the Fed's inspector general, the path to confirmation may be clearing for Warsh, whose nomination has been seen as an attempt by Trump to influence US monetary policy.
The move has been met with skepticism by Democrats, including Senator Elizabeth Warren, who has accused the administration of attempting to install a loyalist as Fed chair. Despite this, the nomination is now likely to move forward, with Tillis expressing his support for Warsh and predicting a smooth confirmation process.