This comes at a pivotal time for US central bank independence, with tension between rate setters and the White House ongoing as Trump continues to urge the Fed to lower interest rates.
US President Donald Trump revealed he will nominate Kevin Warsh as chair of the Federal Reserve to replace Jerome Powell.
In a post on Truth Social today (30 January), Trump said: "I am pleased to announce that I am nominating Kevin Warsh to be the chairman of the board of governors of the Federal Reserve system."
The president added that he has known Warsh for a long period of time and "he will go down as one of the great Fed chairmen, maybe the best".
"On top of everything else, he is ‘central casting,' and he will never let you down. Congratulations Kevin!" Trump added.
Fed holds rates as markets 'remain nervous' about central bank's independence
Warsh previously served as a member of the Federal Reserve board of governors from 2006 to 2011. He also worked for Morgan Stanley in New York, where he became an executive director.
Luke Bartholomew, deputy chief economist at Aberdeen Investments, described Warsh as "a very competent crisis fighter with a good understanding of financial markets, and long track record of independent thought about monetary policy".
Stuart Clark, portfolio manager at Quilter, also welcomed the nomination, describing it as "a sigh of relief" for investors. "This removes an unknown we had leading up to the end of current chair Jerome Powell's term, and is certainly a lot more moderate of a pick than it could have been."
The dollar has strengthened slightly since Trump's post, climbing 0.1% against a basket of other currencies, according to data from MarketWatch. In the equity and bond markets, the S&P opened 0.2% down today while 10-Year US Treasuries were almost flat.
This comes at a pivotal time for US central bank independence, with tension between rate setters and the White House ongoing as Trump continues to urge the Fed to lower interest rates.
At its first meeting of 2026 on Wednesday (28 January), the Federal Open Market Committee decided to leave interest rates unchanged at 3.5%-3.75%.
