Federal Reserve Chairman Kevin Warsh on Wednesday declined to say if he has spoken to President Donald Trump since becoming chair, but confirmed he is in regular communication with the Trump administration.
That doesn't affect his independence, Warsh said.Â
Warsh is in a delicate position seven weeks into his term as Fed chair. Investors are trying to suss out where the Fed will take interest rates, as Warsh pulls back on how the Fed talks about its plans. He was appointed by a president who said lower interest rates were a litmus test for his choice of chair and has continued to call for cuts since Warsh was confirmed. Any suggestion that Warsh didn't come by his views honestly could threaten his ability to bring a divided Federal Open Market Committee to consensus on interest rates.
The White House declined to comment on any conversations between the president and the Fed chairman, saying it doesn't discuss any of the president's private conversations that might or might not have occurred.Â
Spokespersons for Treasury Secretary Scott Bessent and the Fed declined to comment.
Warsh, in the hearing, repeatedly defended his independence and the credibility that flows from it during two days of appearances before Congress, starting with the House on Tuesday and moving to the Senate Wednesday.
"The independence of the Federal Reserve is sacrosanct," Warsh said Tuesday. "Part of the reason for the Fed's power comes not just from a printing press, though it can be useful from time to time. It comes from our credibility, credibility to make the best choices we can consistent with the law that you've written for us."
As Warsh noted in his testimony both days, inflation has remained above the Fed's 2% target for the past 63 months. Inflation fell in June, according to consumer and producer price index data released this week, but Warsh was careful not to take a victory lap.Â
"Any central bank would be happy to have the data going in the right direction. My view is these are all imperfect measures of the state of underlying inflation," he said.
That view of inflation is up for debate within the Fed. Warsh has created a task force to review how the Fed thinks about inflation. But it isn't a given that the Fed will accept the task force's â and Warsh's â views on the matter.
The FOMC appears divided on the course of interest rates. Governor Christopher Waller and New York Federal Reserve President John Williams have said in recent days it may be necessary to raise interest rates this year.
But if Warsh still needs allies on the Fed, he has one in the Trump administration. The White House has said the president defers to Warsh's views about how to manage the Fed, even though Trump still generally wants interest rates down.
The Fed chair and the Treasury secretary meet for a weekly breakfast by longstanding tradition.
Warsh has kept up that tradition with Bessent, and gone beyond it, he said Wednesday.
"I do meet with the Treasury Secretary weekly. I talk to him often between that." He added he will make his own decisions about interest rates.
Warsh and Bessent share a mentor in investor Stanley Druckenmiller, who employed Warsh for more than a decade until he became Fed chairman. Bessent worked for Druckenmiller earlier in his career as a hedge fund manager. Warsh and Bessent didn't overlap in working for Druckenmiller, but the two knew each other well before taking their current jobs.
Warsh said before becoming Fed chairman that he wanted to negotiate a new Treasury-Fed Accord, referring to the 1951 agreement that established the Fed's modern independence. Warsh said he wanted to hand some powers over the Fed's balance sheet to the Treasury secretary. He hasn't elaborated on those views since becoming Fed chair and has created a task force that will review the Fed's balance sheet policy.
Top Trump economic advisor Kevin Hassett said Wednesday on CNBC's "Squawk Box" that he also had recently spoken to Warsh. Hassett said he had praised Warsh's new task forces when the two spoke.
Warsh declined to say under direct questioning from the Senate Banking Committee whether he had spoken to the president since becoming chairman. But he indicated it shouldn't be seen as a problem if he had spoken to the president.
"I certainly don't feel uncomfortable receiving a call from the chairman of this committee or the president of the United States," Warsh said.
Public calendars released by the Fed show Powell met with or called Bessent only a handful of times outside of their regular breakfast meetings. There was only one such meeting in 2026, when Powell and Bessent discussed risks of artificial intelligence with bank CEOs in April.
