Closing post
Time to wrap up
Stocks have dipped on Wall Street, the dollar has rallied, and gold has fallen back after Donald Trump announced he was nominating former Federal Reserve governor Kevin Warsh as the next Fed chair.
The move ends months of speculation about who the president would pick to replace Jerome Powell, as he waged an extraordinary campaign to influence policymaking at the Fed by repeatedly calling for interest rate cuts. Powell’s second term as chair is due to end in May.
Writing on his Truth Social platform, Trump said: “I have known Kevin for a long period of time, and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best. On top of everything else, he is ‘central casting’, and he will never let you down.”
Warsh, 55, a former Federal Reserve governor who has deep ties to Wall Street, had previously interviewed for the job of chair in 2017 when the role went to Powell, whose term ends in May.
Trump’s pick will have to be confirmed by the Senate…. and Thom Tillis, a senator from North Carolina, is sticking with his pledge to block all Federal Reserve nominations until the Department of Justice investigation into Fed chair Jerome Powell is concluded.
The choice of Warsh was applauded by Canada’s prime minister Mark Carney, and former UK chancellor George Osborne.
But some financial analysts questioned whether Warsh would stick to his reputation as a hawkish policymaker, or might now be converted to Donald Trump’s campaign for lower interest rates.
Amid this uncertainty, the Dow Jones industrial average is currently down 122 points or 0.23% at 48,959 points.
Gold, which has benefitted from forecasts of currency debasement, is down 6.5% today at $5,050 an ounce.
Here’s the full story:
And here’s our US Politics Live blog:
The Russell 2000 index, which tracks thousands of small company stocks, is down almost 1% in morning trading in New York.
