The White House officially nominates Kevin Warsh to be the next Chairman of the Federal Reserve

WASHINGTON (AP) — The Trump administration has formally nominated Kevin Warsh, a former senior Federal Reserve official, to be the next Fed chair when Jerome Powell’s term ends in two months.

Read more: What do economists think about Trump’s choice of Kevin Warsh to head the Federal Reserve?

Warsh’s nomination, initially announced on January 30, was advanced to the Senate on Wednesday, where it will be taken up by the Senate Banking Committee.

However, the nomination may falter at this point. Sen. Thom Tillis, a North Carolina Republican on the committee, said he would oppose Wershe’s confirmation until the criminal investigation into Powell is resolved. Powell revealed on January 11 that the Justice Department had subpoenaed the Fed regarding Powell’s testimony in the Senate last June about the central bank’s $2.5 billion building renovation project.

Tillis said last month that the committee might hold a hearing on Warsh’s nomination, but that he would vote to block confirmation. If all Democrats on the committee also vote against Warsh, the nomination would not move from the committee to the full Senate.

Warsh has been highly critical of the Fed’s policies in recent years, including low interest rate policies caused by the pandemic, which he says contributed to the biggest spike in US inflation in four decades in 2021-2022.

However, Warsh has now echoed President Donald Trump’s demands for lower interest rates. Warsh says productivity gains from AI will help the economy grow more quickly without stimulating inflation, enabling the Fed to lower borrowing costs. However, many Fed officials disagree that the development of artificial intelligence will support interest rate cuts.