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In a sometimes fiery confirmation hearing on Tuesday, the man nominated to head the world鈥檚 most important central bank walked a tightrope, addressing issues that ranged from his independence from President Donald Trump to his considerable personal financial holdings.

Kevin Warsh, Mr. Trump鈥檚 choice to chair the Federal Reserve, presented himself to the Senate Banking Committee as a smart, seasoned economist 鈥� cautious about revealing his politics or personal finances, but generally upbeat about the U.S. economy and bold in his vision to reform the central bank.

鈥淢y broad sense is that these inflation risks and the inflation damage of the last several years is improving somewhat,鈥� Mr. Warsh, a former Fed official and currently a lecturer at Stanford Business School and investment firm partner, told committee members. 鈥淭he sooner that we can reform the institution with my colleagues, if [I鈥檓] confirmed, the sooner we can ensure price stability.鈥�

But the path to confirmation remains rocky. The issue has little to do with Mr. Warsh or Fed policy. Instead, Republican Sen. Thom Tillis of North Carolina has threatened to vote against him unless the Justice Department drops its criminal investigation into the current chair, Jerome Powell, over cost overruns of renovations of Fed facilities.

Without Mr. Tillis鈥檚 support, Mr. Warsh would not be recommended by the committee in a straight party-line vote. If the full Senate then takes up the confirmation, the Republican majority is so thin that the defection of more than one senator could kill his candidacy.

Though Mr. Warsh has earned bipartisan respect as an accomplished and capable pick, many Democrats are leery of voting for him because they worry he will cave to President Trump鈥檚 aggressive and direct calls to lower interest rates. Presidents of both parties typically urge the Fed to bring down rates, as lower rates make it cheaper to take out business loans and mortgages, thereby buoying the economy. What is unusual is that Mr. Trump has been so public about it, pressuring Mr. Powell through insults, threats to remove him, and questions about his competence.

During a CNBC interview before the Senate hearing, the president said he would be disappointed if Mr. Warsh, if confirmed, didn鈥檛 cut rates right away.

But the nominee repeatedly denied that Mr. Trump had ever asked him to lower rates during their meetings. When Democratic Sen. Ruben Gallego of Arizona referred to a Wall Street Journal article suggesting that the president had pressed him on interest rate cuts, Mr. Warsh was adamant: 鈥淚 take the integrity of the office and my personal integrity very seriously. ... The president never asked me to commit to any such thing, nor would I ever do so.鈥�

The Fed鈥檚 independence to set interest rates, regardless of political pressure, is considered by many to be key to the central bank鈥檚 credibility in financial circles and around the world.

Another Democratic concern 鈥� that Mr. Warsh鈥檚 considerable investments could involve conflicts of interest 鈥� provided the greatest fireworks of the session. Mr. Warsh would almost certainly be the wealthiest Fed chair ever, dwarfing Mr. Powell鈥檚 estimated $75 million net worth. Mr. Warsh鈥檚 wife, Jane Lauder, is an heiress to the Est茅e Lauder beauty empire, with an estimated net worth of $1.9 billion. (Marriner Eccles, who served from 1934 to 1948, was widely considered the wealthiest chair before Mr. Powell.)

Sen. Elizabeth Warren of Massachusetts, the committee鈥檚 ranking Democrat, wasted no time in challenging the nominee, asking whether he is invested in any companies affiliated with the Trump family, companies that facilitated money laundering, Chinese-controlled firms, or businesses established by Jeffrey Epstein.

Mr. Warsh began discussing the Fed鈥檚 policy tools. Senator Warren, who referred to Mr. Warsh as President Trump鈥檚 鈥渃hosen sock puppet,鈥� cut him off: 鈥淐ould you answer my question, please?鈥�

Mr. Warsh responded: 鈥淪enator, I have worked tirelessly with the ethics officials at the Office of Government Ethics, come to an ethics agreement with them, and have agreed, Senator, to sell all of my financial assets.鈥�

Ms. Warren talked over him: 鈥淎re you refusing to tell us if you have investments, for example, in vehicles set up to advance Jeffrey Epstein?鈥�

Mr. Warsh dodged the question, emphasizing that he had signed an agreement with the Office of Government Ethics to sell virtually all his assets upon confirmation as Fed chairman.

Careful not to cross Mr. Trump, the nominee also dodged a question about whether the president lost the 2020 election (Mr. Trump maintains, without evidence, that he won). Mr. Warsh鈥檚 attempts to avoid criticizing either Republicans or Democrats reflect the kind of tightrope he would walk were he to become Fed chair.

The central bank has been cutting interest rates to buoy the economy. But it has recently paused that policy because inflation has ticked up. In fact, the Fed might now have to raise rates if that trend continues. By contrast, the economy has flashed mixed signals about whether growth has stalled.

Among Mr. Warsh鈥檚 proposed reforms: improving the Fed鈥檚 data collection so it could more accurately gauge inflation, and putting a stop to forecasting the direction of interest rates.

Mr. Warsh argues that the economy is poised for an important change, in which artificial intelligence could provide considerable productivity gains. Senators on both sides of the aisle questioned the nominee on its potential impact, especially if those productivity gains lead to massive unemployment.

鈥淭he pace of change in these technologies is accelerating,鈥� he responded. 鈥淎I, which I think of really as American ingenuity, gives America a huge head start relative to our competitors around the world. But it鈥檚 not without real risks and real challenges, and a forward-looking, reform-oriented central bank needs to be on the front end of it.鈥�