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Kevin Warsh clears key Senate hurdle in bid to lead U.S. Federal Reserve

Kevin Warsh, President Trump's nominee to lead the Federal Reserve, cleared a key procedural hurdle in the Senate on Monday, moving closer to confirmation. The Senate voted for cloture and is expected to confirm Warsh as Fed governor and then as chair, succeeding Jerome Powell whose term ends Friday. Warsh has advocated for 'regime change' at the Fed, including tighter coordination with the Treasury on non-monetary policies and a smaller balance sheet. Trump has publicly called for rate cuts, but Warsh says he has not made promises. Meanwhile, Powell has expressed concern over legal attacks on the Fed's independence, including a dropped DOJ investigation into his management of a renovation. The Fed's next meeting is June 16-17, which could be Warsh's first as chair. The transition comes at a time of tension between the White House and the central bank over monetary policy direction. The confirmation of Warsh could signal a shift toward more political alignment of monetary policy with executive branch preferences. Markets may react to uncertainty about rate decisions, especially with three dissenters at the last meeting open to a rate hike. The Fed's independence remains a critical issue, as legal challenges and political pressure test its ability to set policy without interference. For the technology sector, interest rate changes directly affect venture capital, startup valuations, and borrowing costs. A more coordination-oriented Fed could either stabilize or disrupt current market dynamics depending on the policy path.