The Department of Justice has ended its investigation into Federal Reserve Chair Jerome Powell, which centered on building-renovation cost overruns at the Fed. The dropped probe removes a significant political obstacle that had complicated the potential nomination of Kevin Warsh as Powell's successor. No charges were filed against Powell or the Federal Reserve.
The resolution reduces near-term uncertainty around Fed leadership succession, which matters because markets hate ambiguity at the top of the central bank. A cleaner path to a Warsh nomination is worth watching — he is widely viewed as more hawkish than Powell, meaning he may favor keeping interest rates higher for longer, which would pressure rate-sensitive assets like long-duration bonds, growth stocks, and real estate. Short-term, the removal of legal cloud over the Fed is a mild stabilizing signal for broader markets.
Ongoing: White House signals on Kevin Warsh nomination timeline. Powell's current term as Chair runs through May 2026. Watch for any Senate confirmation hearing dates if a formal nomination is announced.
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