The Justice Department’s legal maneuvering has thrown a wrench in Kevin Warsh’s bid to become the next Federal Reserve chair. A federal judge dismissed subpoenas issued by the Justice Department in a criminal probe into Jerome Powell’s handling of Fed headquarters renovations, but Jeanine Pirro, the U.S. attorney for D. C., vowed to appeal, keeping the nomination in limbo.

This development complicates President Trump’s effort to install a Fed leader more aligned with his economic agenda, as the investigation threatens to delay Warsh’s confirmation. Senator Thom Tillis criticized the probe as a “failed attack on Fed independence,” urging Pirro to drop it, while Senator Tim Scott pushed for the investigation to “go away” to expedite the process. The Senate Banking Committee, which oversees Fed appointments, faces internal pressure to act swiftly, but Elizabeth Warren and other Democrats have vowed to block any nominee until the inquiry concludes. The drama underscores Trump’s broader strategy to reshape the Fed, even as Powell’s term ends in May and the central bank’s independence remains a flashpoint.

The case highlights the tension between political influence and institutional autonomy, with Fed independence and interest rate policy at stake.