All eyes turn to Fed chair Kevin Warsh and his first moves on interest rates

Article excerpt

Kevin Warsh, Trump's nominee to lead the Federal Reserve, faces immediate pressure to choose between two competing priorities: raising interest rates to combat inflation or cutting them as the president has repeatedly demanded. Since his January nomination, Wall Street and economists have watched closely to see which direction Warsh, a former Fed governor with close ties to Trump, will take when he assumes the chair. The decision carries enormous consequences for borrowing costs, employment, and economic growth. Warsh's approach will reveal whether he can balance the Fed's traditional independence from political pressure with Trump's explicit expectations for monetary policy.