Washington DC [US], May 19 : US President Trump will host the swearing-in ceremony for incoming Federal Reserve chair Kevin Warsh on Friday, Wall Street Journal reported. The swearing-in ceremony assumes importance as Trump has personally taken keen interest in the appointment of Warsh after disagreements with Powell over interest rate cuts. On May 14, the White House had informed that Kevin Warsh had been confirmed as the Chairman of the Board of Governors of the Federal Reserve System.
Outgoing Fed chair Jerome Powell, who was also picked by Trump in his first term, was sworn-in at the Federal Reserve. Trump had skipped the ceremony.
Before picking Powell, Warsh had been interviewed for the position of Fed chair in 2017 by Trump. Powell was reappointed in 2021 for a second term by the Biden administration. Alan Greenspan was the last Federal Reserve chair who was sworn-in in the White House in 1987.
Warsh was confirmed as Federal Reserve chair last week by the Senate for a period of four years. The Federal Reserve had said that Powell would continue as acting chief until Warsh is sworn-in.
The transition is likely to be smooth after Warsh's confirmation by the Senate and his consent for divesting some of his personal investments in order to meet ethics requirement.
Powell would continue to be a governor on the Federal Reserve board for an unspecified period.
Warsh is taking over at a critical moment in the US economy as prices soar and consumer sentiment takes a hit amid an uncertain Iran war. Oil prices have shot up even as the volatility continues to rattle investors with no signs of resolution emerging in West Asia.
Warsh was the youngest governor to join the Federal Reserve in 2006 after stints in the Bush administration and Morgan Stanley. He brought his Wall Street skillset to the Federal Reserve, which was dominated by economists.
He was concerned about the Federal Reserve's extensive bond-buying programme during the 2008-09 global financial crisis as a means to support the economy. He feared it would be unwieldy and eventually become a tool at the hands of the government.
Warsh has vowed to trim the Fed's bloated balance sheet, which runs over $6 trillion, along with a slew of other changes that have sent mixed signals to Wall Street.
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