Prediction markets are downplaying the likelihood that Federal Reserve Chair Jerome Powell will be removed early, despite a federal criminal investigation into the Fed’s $2.5 billion headquarters renovation.

On Polymarket, the chance that Powell steps down by March 31 is priced at just 8%, barely shifting after Powell accused the administration of using the probe to pressure monetary policy. Another Polymarket contract places a 67% probability that Powell will leave the Fed Board by late May, indicating his influence may persist even after leaving the chair role. Similarly, Kalshi contracts imply only a 19% chance of Powell exiting before May 2026, up sharply on the day but still seen as a low-probability event.

Markets broadly reflect that cautious outlook. Cryptocurrencies were largely flat, with bitcoin near $91,400 and ether above $3,100, suggesting traders are not repositioning for immediate changes in Fed policy. Safe-haven assets were more active, however: gold climbed above $4,580 an ounce, and silver rose over 4.5%, reflecting either their higher volatility relative to crypto or expectations for continued loose monetary policy under a new Fed chair.

Prediction market traders are favoring Kevin Warsh as a potential successor, giving him a 43% chance according to Polymarket. Warsh has argued that inflation stems from excessive government spending and an overextended central bank, advocating for a smaller, less politicized Fed, a reduced balance sheet, and a renewed focus on strict price stability.

Market snapshot:

• Bitcoin (BTC): Around $91,400, largely ignoring Fed-related political risk.
• Ethereum (ETH): Near $3,125 after pulling back from its 100-day moving average; momentum indicators suggest a potential short-term recovery if key support levels hold.
• Gold: Up more than 1% to roughly $4,573, extending gains after mixed U.S. jobs data reinforced expectations for Fed rate cuts amid slowing growth, persistent inflation, and a weaker dollar.
• Nikkei 225: Closed for a public holiday, leaving local investors on the sidelines as broader Asia-Pacific markets followed Wall Street’s record gains