Warsh nears Fed confirmation as hotter inflation pressures rate-cut outlook

The U.S. Senate is expected to confirm Kevin Warsh as Federal Reserve chair on May 13, 2026, as fresh inflation data intensifies pressure on the central bank to keep interest rates higher. Warsh would take over from Jerome Powell, whose term ends May 15, 2026. Wholesale prices rose 6% in April, driven largely by energy costs, while the Consumer Price Index climbed 3.8%, up from 3.3% in March. Core CPI rose to 2.8% from 2.6%, and services inflation excluding energy increased 3.3%. The Fed’s preferred PCE index for April is expected to rise to 3.3%, still above the central bank’s 2% target. Markets largely expect rates to remain steady through 2026, though odds of a rate increase have risen to 20% for October and 30% for December. Fed officials have grown more cautious as tariffs, oil prices and persistent services inflation complicate the case for cuts.