Warsh sworn in as Fed chair; markets see low odds of cuts

Kevin Warsh will be sworn in as chair of the Federal Reserve Board of Governors on Friday after the Senate confirmed his nomination on Wednesday. He succeeds Jerome Powell and will preside over the Federal Open Market Committee, which is scheduled to meet on June 16.

Markets assign limited odds to an interest-rate cut. A prediction-market contract on Kalshi implies a 38.2% chance the Fed will lower rates before 2027, down from about 96% in February. The CME Group FedWatch tool, which uses fed funds futures, shows roughly a 98.8% probability that the central bank will keep the target range at 3.50%–3.75% through the end of June and better than 94% odds of no change through July.

President Donald Trump nominated Warsh and had publicly urged the Fed to lower interest rates. Trump had indicated he would be disappointed if Warsh did not move quickly to cut rates after confirmation.

Warsh disclosed more than $100 million in personal assets ahead of his confirmation hearing, including investments tied to artificial intelligence and cryptocurrency-related companies. These holdings and his private-sector ties were a focus of scrutiny during the Senate review.

Massachusetts Senator Elizabeth Warren warned that confirming Warsh could create conflicts, including the Fed extending special accounts to the Trump family’s crypto company or providing bailouts to associates on Wall Street. Her statements were part of broader concern among some lawmakers about potential conflicts of interest.

Lawmakers have also pressed the White House to fill vacant seats at the Commodity Futures Trading Commission. Since December the CFTC has been led by President Trump’s nominee Michael Selig. Republican and Democratic leaders of the House Committee on Agriculture asked the president to nominate a full panel of commissioners, citing urgent regulatory issues.

The CFTC has been asserting authority over prediction-market platforms while several state regulators have filed lawsuits against firms such as Kalshi and Polymarket. Lawmakers voiced concerns about how CFTC rulemaking would proceed if the Digital Asset Market Clarity Act, a bill intended to clarify market structure for cryptocurrencies, were enacted.

Warsh’s swearing-in formalizes the leadership change at the Fed. Current market pricing indicates investors expect the central bank to maintain its policy stance at least through the June meeting. Market participants will look to Warsh’s early public remarks and his voting behavior on the FOMC for signals about the timing of any future rate changes.