Federal Reserve Chairman Jerome Powell speaks during a press conference after the Federal Open Market Committee at the Federal Reserve Building in Washington, March 18, 2026.
Brendan Smialowski AFP | Getty Images
Federal Reserve Chairman candidate Kevin Warsh wants to lower interest rates. Fed officials suggested Wednesday that if he is confirmed to take the job soon, it could be even harder to achieve than expected.
Fed officials raised their forecasts for the trajectory of inflation and interest rates in data released by the central bank on Wednesday. This was largely expected, given the rise in oil prices caused by the Iran war. But Chairman Jerome Powell said oil is not the only factor his colleagues are considering.
Powell also said the rise in the inflation outlook “reflects the slow progress to date on tariffs.”
The Fed publishes a survey of its officials’ expectations for interest rates and the economy in a document known as the Economic Forecast Summary. The SEP released on Wednesday showed officials’ median forecast for a closely monitored measure of inflation, known as core personal consumption expenditure inflation, would rise to 2.7% annually as of March from 2.5% in 2026 as of December.
Meanwhile, the SEP showed multiple Fed officials raising interest rate forecasts on a so-called dot plot. This shows where Fed members believe interest rates are headed. The March dotplot showed multiple Fed officials ruling out multiple rate cuts this year.
Those forecasts are anonymous, but Fed officials who had previously publicly voted in favor of rate cuts changed their stance in March. Fed Director Christopher Waller opposed cutting interest rates in January, and the Fed chose not to change rates then either. Mr. Waller agreed with Mr. Powell at their most recent meeting to keep interest rates unchanged.
President Donald Trump appointed Mr. Waller without hesitation in lowering interest rates and considered Mr. Warsh as a possible chairman before selecting him.
All of this means Warsh could face a tough audience if confirmed quickly. Mr. Warsh wants to lower rates, in line with what Mr. Trump has been demanding of his candidates. But the chair only has one vote out of 12 on the Fed’s rate-setting committee. He will need to be accompanied by the rest of the Fed, many of whom appear intent on making it difficult to cut rates before Warsh’s approval.
Powell said these officials are wary not only of the economic impact of persistently high oil prices, but also of the impact of President Trump’s tariffs. This remains true despite the Supreme Court’s recent ruling that President Trump’s tariffs are illegal. The administration moved to reimpose tariffs under an alternative authority.
When Warsh will be confirmed is an open question. Sen. Thom Tillis, R-N.C., said he would not vote for Warsh’s confirmation until the criminal investigation into Powell over office renovation cost overruns is resolved.
Mr. Powell denies the accusations. A federal judge last week moved to quash the subpoena against the Fed. The Justice Department announced that it would appeal. Mr. Powell will remain in office as long as that process continues. And Mr. Warsh’s confirmation remains on hold, likely delaying the need to combat inflationary pressures that could hinder lower interest rates.
