The US Department of Justice's decision to drop its investigation into Federal Reserve Chair Jerome Powell has brought President Donald Trump's nominee, Kevin Warsh, one step closer to confirmation. Warsh, who has significant personal wealth, including investments in cryptocurrency, is awaiting a final Senate vote after appearing at a confirmation hearing. Trump has been critical of Powell's management of interest rates and has chosen Warsh as his replacement.
However, Republican Senator Thom Tillis had threatened to block Warsh's confirmation as long as the DOJ investigation into Powell was ongoing. The investigation, which was related to cost overruns in a Fed building project, has been passed to the Fed's inspector general, who will issue a report. Following the news, betting odds on Warsh's confirmation before May 15 surged from 30% to over 80%.
US Attorney Jeanine Pirro stated that she expects a comprehensive report and is confident that it will resolve the questions that led to the investigation. Trump's ability to appoint his own people to the Federal Reserve will give him greater influence over US monetary policy and provide him with more allies on the Fed board. The move has been met with criticism from Senator Elizabeth Warren, who described it as an attempt to clear the path for Warsh's confirmation. Warren noted that the administration is still pursuing a criminal probe against Fed Governor Lisa Cook.
Senator Tillis, on the other hand, has expressed his support for Warsh, describing him as a 'great nominee' and stating that he will vote in favor of his confirmation now that the DOJ has dropped its investigation into Powell.