Biden keeps Powell as U.S. Fed chair, names Brainard vice chair
BNN Bloomberg
President Joe Biden selected Jerome Powell for a second four-year term as U.S. Federal Reserve chair and elevated Governor Lael Brainard to vice chair, maintaining consistency at the central bank as it grapples with the fastest inflation in three decades and the lingering effects of the coronavirus.
President Joe Biden preserved continuity at the Federal Reserve by selecting Jerome Powell for a second term as chair and elevating Lael Brainard to vice chair as the U.S. central bank grapples with the fastest inflation in three decades and the lingering effects of COVID-19.
The decision, announced by the White House on Monday, rewards Powell for helping rescue the U.S. economy from the pandemic and tasks him with protecting that recovery from a surge in consumer prices. A Republican, Powell will likely win a smooth confirmation in the Senate, although progressive Democrats may be disappointed by the choice.
Brainard would replace Richard Clarida in the vice chair slot and may face opposition from Senate Republicans for her confirmation given her tough line on bank regulation. She was interviewed by Biden for the chair position and was seen as a strong contender for the separate job of vice chair for supervision, which remains vacant.
Biden plans to announce a pick for that role along with additional nominations for open seats on the Board of Governors beginning in early December, the White House said.
“This provides a moment of certainty in an persistently uncertain world for the Federal Reserve,” said Diane Swonk, chief economist at Grant Thornton LLP. “Powell and Brainard are a powerful duo, who have shifted the Fed to focus more on inequality. Inflation foments inequality -- they get that.”
U.S. equities rose after the news, likely welcoming continuity at the Fed. Investors expect the central bank to raise interest rates from near zero in June, according to pricing in interest-rate futures markets.
