Warsh Says He Won’t Be Trump’s ‘Sock Puppet’ in Fed Role Amid Rate Debate

Former Federal Reserve official Kevin Warsh has pushed back against concerns over his independence, telling lawmakers he would not act as a “sock puppet” for Donald Trump if confirmed as chair of the Federal Reserve.

Appearing before a Senate committee, Warsh faced questions about his conversations with Trump, who has repeatedly called for interest rate cuts. Democratic senators expressed concern that the nominee might align monetary policy too closely with the president’s preferences.

Warsh said he had never advised Trump on where interest rates should be set, arguing that policymakers should avoid publicly pre-judging such decisions.

“That’s unhelpful,” he told the hearing, adding that central bankers should remain flexible and responsive to incoming economic data rather than committing to positions in advance.

He also denied striking any agreement with Trump to lower rates if confirmed, stressing the importance of maintaining the Fed’s independence.

Despite inflation remaining above the Fed’s long-term target in recent years, Warsh signalled a willingness to reassess how inflation is measured, saying he had limited confidence in traditional indicators. His comments suggested that elevated inflation alone might not necessarily prevent rate cuts under his leadership.

In his opening remarks, Warsh highlighted the cost of living as a central concern for Americans, noting it may be the most pressing economic issue facing the country.

While he described the broader economy as being close to full employment, Warsh acknowledged that many Americans continue to feel the strain of rising prices.

Responding to questions from Andy Kim, he said policymakers should not dismiss public perceptions of economic hardship.

“Central bankers should not be second-guessing what people feel and see in their own lives,” Warsh said.