Kevin Warsh sworn in as new Federal Reserve chair
Andy Hickman
Kevin Warsh was sworn in Friday as the new Federal Reserve chair, succeeding Jerome Powell after a party-line Senate vote. He takes office amid rising inflation and political pressure from the White House to cut interest rates.
Kevin Warsh was sworn in as the new chairman of the Board of Governors of the U.S. Federal Reserve on Friday (May 15, 2026), succeeding Jerome Powell, who had held the position since 2018. The ceremony followed a contentious nomination process.
The U.S. Senate voted along party lines to confirm Warsh to the Board of Governors and as chair. Only Senator John Fetterman of Pennsylvania broke with his Democratic colleagues to support the nomination.
Warsh takes the helm as the central bank's independence faces intense scrutiny under political pressure. During questioning before the Senate Banking Committee, Senator Elizabeth Warren (D-Massachusetts) accused Warsh of being a "puppet" of President Donald Trump. Warsh rejected the accusation and pledged to maintain independence in monetary policy decisions.
When Joe Biden was still president, Warsh had opposed interest rate cuts, though he shifted his stance after Trump took office. In December 2025, Trump declared he would only appoint a Fed chair who agreed with him on lowering rates.
However, Warsh cannot single-handedly set policy as one of 12 voting members on the Federal Open Market Committee. His first policy meeting as chair is set for June 16–17.
Inflation pressures
Pressure from the White House to cut rates comes as inflation rises in the United States. According to the latest Consumer Price Index (CPI) report from the Bureau of Labor Statistics, consumer prices rose 0.6% in April 2026, after a 0.9% gain in March.
Year-over-year, prices climbed 3.8% compared to April 2025 — the largest annual increase in three years. Energy prices surged 17.9% over the past twelve months.
American consumers are feeling the pinch at the pump. The average price of gasoline reached $4.56 per gallon (3.78 liters), according to the American Automobile Association. That is up from $2.98 per gallon on February 28, when the U.S. and Israel first struck Iran.
Rising prices may pressure the Fed to hold rates steady rather than cut them. Analysts at JPMorgan Chase forecast rates will remain unchanged until mid-2027 and may even be raised instead of lowered.
"With inflation running above 2% for the past five years, heightened by the Middle East conflict, alongside price pressures in some sectors not related to tariffs or energy, staff view inflation as potentially more persistent than anticipated and a notable risk," the Fed said in minutes from its April meeting.
The CME Group's FedWatch tool, which tracks the probability of monetary policy decisions, shows a 97% chance rates will be left unchanged at the upcoming policy meeting.
