White House economic adviser Kevin Hassett expressed strong confidence that Jerome Powell will step down as Federal Reserve chairman when his term ends in May, paving the way for Kevin Warsh to take the helm. Hassett’s remarks, made during an interview on Fox Business Network’s ‘Mornings with Maria,’ underscored the administration’s expectation of a smooth transition.
Hassett indicated that Warsh’s confirmation hearing is on track to begin next week, signaling momentum in President Donald Trump’s push to install a new central bank leader. ‘I’m highly confident that that will happen,’ Hassett stated, emphasizing his belief that Powell would not remain on the Fed’s board once a successor is confirmed. He further noted that Powell had signaled an intent to step aside once a new chair is in place, describing it as the ‘appropriate thing’ to do.
However, Powell’s own statements paint a less certain picture. In March, he asserted he would not leave the Fed until a criminal investigation led by U.S. Attorney Jeanine Pirro concludes. Powell also remains undecided on whether to stay in a governor’s seat on the central bank’s board, a position that extends until 2028.
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Complicating the transition, a U.S. judge last week upheld a block on subpoenas related to the investigation into Powell. This ruling sets the stage for a likely appeal, potentially delaying Trump’s efforts to reshape the Fed’s leadership with a more aligned figure like Warsh. The legal wrangling adds a layer of uncertainty to an already pivotal moment for U.S. monetary policy.
Powell’s term as Fed chair officially expires in May, a deadline that looms large over these developments. With the confirmation process for Warsh advancing and legal hurdles persisting, the central bank’s direction hangs in a delicate balance. The outcome of the appeal on the subpoenas could determine whether the transition occurs on the White House’s anticipated timeline or faces further postponement.
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