Kevin Warsh Is the New Fed Chair and Rates May Not Drop This Year.
Here’s What That Means for Your Portfolio
The Trump administration faced its fair share of obstacles in getting Kevin Warsh approved as the new chair of the Federal Reserve, but they have officially crossed the finish line. Mostly along party lines, the U.S. Senate approved Warsh’s appointment by a vote of 54-45.
While Warsh has had to walk a fine line to reach the top position at the Federal Reserve’s Board of Governors, it may prove to be the easy part. Warsh will now face the daunting task of appeasing President Trump, dealing with a divided Federal Open Market Committee (FOMC) that sets monetary policy, and navigating a difficult economy that has made it hard for the Fed to achieve its dual mandate of maximum employment and stable prices. Following recent economic data from April, it seems unlikely that the Fed will be able to cut interest rates this year, and even possibly next year.