The Trump administration has taken a significant step towards exerting greater control over the US financial system, as the Department of Justice has dropped its investigation into Federal Reserve Chair Jerome Powell. This move could pave the way for the confirmation of Kevin Warsh, Trump's nominee to replace Powell, who has been awaiting a final vote from the Senate. Warsh, a wealthy individual with investments in the crypto sector, appeared in a confirmation hearing and is expected to remedy the high US interest rates that Trump has blamed on Powell. The investigation, which was related to cost overruns in a Fed building project, was passed on to the Fed's inspector general, and the US Attorney for the District of Columbia, Jeanine Pirro, stated that the DOJ may reopen the investigation if necessary.
The news has led to a significant increase in the odds of Warsh's confirmation, with some prediction markets showing a rise from 30% to over 80%. The move has been met with criticism from Senator Elizabeth Warren, who dismissed it as an attempt to clear the path for Warsh's confirmation, while Senator Thom Tillis, who had previously threatened to block the confirmation, has expressed his support for Warsh.