Kevin Warsh survived a Senate Banking Committee hearing for the Federal Reserve chair seat without sparking a Treasury sell‑off. His answers skirted questions about independence from Donald Trump and the president’s promise not to pursue a criminal probe into outgoing chair Jay Powell. The hearing ended with modest Treasury volatility, keeping bond markets within recent ranges.

Warsh avoided a direct answer to Senator Elizabeth Warren’s query on the 2020 election winner and to Trump’s intent to fire Fed governor Lisa Cook. He reiterated he had pledged no rate‑setting deal to the president. Investors noted his call for a new inflation framework, hinting at a shift away from balance‑sheet tools that could raise market uncertainty.

The hearing also spotlighted Warsh’s stance on energy‑related inflation and tariffs, suggesting he would treat rising oil prices differently than past Fed approaches. Meanwhile, Avis shares, spurred by a short squeeze, surged sharply, drawing attention away from the Fed saga. Market observers conclude that Warsh’s candidacy could reshape monetary policy, but its success hinges on a clear plan. This shift could influence bond yields and investor sentiment overnight.