Senate Confirms Walsh as Fed Governor, Chair Vote Expected Soon

The U.S. Senate has confirmed Walsh to a 14‑year term as Federal Reserve Governor, a move that clears the way for him to succeed Jerome Powell as Chair. The Senate has already begun the confirmation process for Walsh’s four‑year term as Chair, with a vote expected as early as Wednesday. Powell’s tenure as Chair expires Friday.

Walsh’s arrival comes at a moment of heightened political tension for the Fed. The Trump administration has exerted unprecedented pressure on the central bank to cut interest rates, even as inflationary pressures rise due to surging oil prices following the outbreak of war in Iran. Market expectations for rate cuts this year have narrowed sharply, with current pricing showing about a one‑third chance of a rate hike before December. The Fed’s short‑term rate target currently stands at 3.50% to 3.75%.

The administration’s efforts have included attempts to dismiss Fed Governor Lisa Cook and support for a Justice Department investigation into a renovation project overseen by Powell. A federal judge described the probe as a pretext to pressure Powell into cutting rates or resigning. Although the Justice Department later dropped the investigation, officials have left open the possibility of reopening it. In response, Powell announced he would remain on the Board as a Governor after his Chair term ends, citing the need to defend the Fed’s independence from political interference.

Walsh, a lawyer, financier, and former Fed Governor, has signaled a clear policy agenda. He intends to push for a “policy shift” that includes closer coordination with the Treasury and the Trump administration in non‑monetary areas, as well as reducing the Fed’s balance sheet to create room for lower policy rates. While the Chair holds only one vote among the 12 on the Federal Open Market Committee, Walsh’s leadership will shape the tone of policy discussions.

The Fed’s next meeting, scheduled for June 16–17, is expected to be Walsh’s first as Chair, marking the beginning of a new chapter in the central bank’s leadership amid one of the most politically charged environments in its history.