Powell Probe Update Clears Path Toward Next Fed Leadership Shift

• DOJ drops criminal probe into Fed Chair Jerome Powell, removing a key political hurdle.
• This action is expected to facilitate the confirmation of Kevin Warsh as the next Fed Chair.
• U.S. economic data, such as retail sales and PMIs, remains resilient despite higher energy prices.
• Oil prices are anticipated to remain elevated, potentially setting a floor for longer-term interest rates.

The Department of Justice is reportedly dropping its criminal probe into Fed Chair Jerome Powell, which is expected to clear the path for Kevin Warsh's confirmation as the next Fed Chair. This removes a layer of political uncertainty for the markets ahead of the upcoming FOMC meeting. Despite geopolitical tensions and higher oil prices, U.S. economic data, including retail sales and PMIs, continues to show resilience.