Investors and analysts already know Warsh is going to be dovish on the base rate. The president said any nominee would have to be open to cutting further. A tighter balance sheet might be a neat way for Warsh to deliver rate cuts without raising alarm bells over questions of Fed independence. As Professor Yiming Ma, of Columbia University’s Business School explained in a conversation with Fortune: “People often think: ‘Oh, economic conditions, inflation expectations, and unemployment are determining interes ...

Federal Reserve Chair nominee Kevin Warsh has several paths toward reducing the central bank’s $6.6 trillion balance sheet but the process will be costly and lengthy, Wall Street strategists say. Warsh has called for dramatically paring the Fed’s massive financial footprint, rekindling the debate around the size of its portfolio which swelled after successive rounds of crisis-driven asset purchases. Minutes from the January policy meeting due Wednesday are likely to offer insights on policymakers’ latest ...

February 6, 2026 09:00 AM GMT US Economics Weekly | North America Shining a spotlight on the Fed's footprint The nomination of Kevin Warsh as Chair of the Federal Reserve has brought renewed focus on the Fed's presence in financial markets. Key Takeaways Exhibit 1: The Treasury General Account has ballooned after the financial crisis and COVID. Cutting the TGA in half would allow the Fed to reduce its securities holdings by $500bn without altering reserve balances Treasury General Account ($bn) 96 98 00 02 ...

Economic Outlook - The U.S. economy is still perceived to be in solid shape, with growth forecasts upgraded to approximately 2.5% on average for 2025 and 2026 [2] - Job demand and labor supply will be critical factors influencing economic resilience and inflation management [3] Tariff and Trade Concerns - Tariffs remain a significant concern, although their impact has diminished compared to previous months; current tariffs are lower than initially threatened [5][6] - The uncertainty surrounding tariffs continues to affect businesses, particularly with the U.S.'s largest trading partners, Mexico and Canada [7] Federal Reserve Dynamics - The Federal Reserve has maintained its position, with a new chairman nominated, introducing uncertainty into future monetary policy [8] - The new chairman's approach to reducing the balance sheet while potentially lowering short-term rates raises questions about feasibility [10][11] - Confirmation processes and legalities surrounding the Fed's renovation costs may impact the new chairman's ability to implement changes [12]