Overview
- Sen. Thom Tillis said he will oppose any Federal Reserve nominee until the DOJ’s inquiry into Chair Jerome Powell is fully resolved, a stance that could deadlock the Banking Committee 12–12 and stall Kevin Warsh’s advancement.
- The DOJ is investigating whether Powell misled Congress about a roughly $2.5 billion headquarters renovation, a probe Tillis calls political pressure that threatens the Fed’s independence.
- At the Alfalfa Club dinner, President Trump joked he might sue Warsh if rates are not cut, later telling reporters the line was a roast and saying he received no rate-cut guarantees.
- The White House praised Warsh as highly qualified and criticized Tillis for holding the economy “hostage,” while outside analysts note Warsh’s crisis-era hawkish record and recent openness to rate cuts.
- Markets quickly priced in Warsh’s credibility: the dollar rose, gold fell about 9% and silver plunged over 30%, as investors also weighed his long-standing push for a smaller Fed balance sheet and the risk of higher long-term yields.