Powell to remain as Fed chair
Biden, unwilling to risk disrupting economy, to renominate Republican
WASHINGTON — President Joe Biden will nominate Jerome Powell to lead the Federal Reserve for a second term, signaling a vote of confidence for the Republican chair as the economy continues to face challenges and uncertainty amid the ongoing pandemic.
In a Monday announcement, Biden also said he would nominate Lael Brainard, the Fed board’s lone Democrat, to be the central bank’s vice chair. Brainard had long been discussed as the main alternative to Powell, due largely to her influence on the Fed board on issues ranging from monetary policy to climate issues to banking regulation. Now, if confirmed by the Senate, they will lead the Fed together.
Powell’s nomination signals Biden’s intent for continuity at the central bank, which is grappling with inflation at 30-year highs, widespread changes in the labor market and looming questions over how the Fed should and will respond. Whether the Fed’s policies prove to be right will have major implications for the U.S. and global economy.
“I’m confident that Chair Powell and Dr. Brainard’s focus on keeping inflation low, prices stable, and delivering full employment will make our economy stronger than ever before,” Biden said in a statement Monday. “Together, they also share my deep belief that urgent action is needed to address the economic risks posed by climate change, and stay ahead of emerging risks in our financial system.”
Powell, 68, has already won widespread praise across Washington for steering the Fed and broader economy through the coronavirus pandemic. He was first nominated to the Fed board by President Obama and elevated to the top job by President Trump. His first four-year term as chair expires in February.
As speculation around Biden’s pick grew, people close to the Fed and Capitol Hill believed that reappointing a popular Republican chair would carry political weight at time of such high partisanship and heated squabbling over inflation and Biden’s economic agenda.
The nominations will go before the Senate Banking Committee and then a full confirmation vote in the Senate. Powell and Brainard are expected to garner enough support from Democrats and Republicans to be confirmed again.