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Updated on: May 13, 2026 / 3:19 PM EDT
/ CBS News
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Washington — The Federal Reserve will get a new leader on Friday — but his power isn't as vast as it might seem.The Senate confirmed Kevin Warsh, President Trump's pick for Fed chair, in a 54-45 vote on Wednesday. Mr. Trump's goals for the monetary policy job are not difficult to discern: He has openly pressed the Fed to slash interest rates for months, and has repeatedly lashed out at outgoing Chair Jerome Powell for not rapidly cutting rates.Warsh — who has vowed to be an "independent actor" and said he will not set policy based on Mr. Trump's views — will get a chance to weigh in next month, when the Fed's interest rate-setting committee is scheduled to have its next meeting. His plans are not clear. He suggested some openness to rate cuts last year, but in a prior stint as a member of the Fed's Board of Governors, he was known for favoring tighter monetary policy.But he won't be able to decide on rates all on his own. Fed chairs usually have a great deal of influence over the rate-setting committee, but their power is not absolute. Experts say Warsh will need to work to form consensus on the right path forward — a tricky task in an economic landscape marked by uncertainty, fears about the Iran war and a stubborn inflation problem. Most analysts expect interest rates to remain steady for the next few months.Plus, at least for now, Powell is planning to remain on the Fed board, after a controversial criminal probe by the Justice Department led him to stick around."The chair has the power to persuade," said Randall Kroszner, who served alongside Warsh as a Fed governor from 2006 to 2009 and now works as a University of Chicago professor. "And they're in a very strong position to be able to persuade. But they still need to persuade."Who actually sets interest rates?
