Sen. Tillis Expected to Clear Way for Kevin Warsh as Fed Chair

Summary

Michael McKee discusses the historic week ahead for the Federal Reserve, including the Senate Banking Committee's vote on Kevin Warsh as the next Fed chair and Jerome Powell's final press conference. The Fed is not expected to change rates, but the focus will be on Powell's future and the inflation outlook amid war-related supply disruptions and rising prices from China.

• The Senate Banking Committee is set to vote on Kevin Warsh as Fed chair, with Senator Tillis expected to support.
• Jerome Powell’s last meeting as chair will not include rate changes or new projections.
• Powell may remain on the Fed as a governor until the inspector general’s report clears him.
• Inflation concerns persist due to second-round effects from the war and Chinese export price increases.
• The Fed faces a dilemma between fighting inflation and supporting the labor market.
• Energy price spikes are seen as temporary but will not return to previous lows.
• The war is causing supply disruptions affecting US and global companies.
• Kevin Warsh has criticized the Fed’s 2021 inflation response and may push to change the inflation framework.