https://sputnikglobe.com/20211122/biden-nominates-fed-chair-powell-for-second-term-amid-us-inflation-scare-1090934016.html
Biden Nominates Fed Chair Powell for Second Term Amid US Inflation Scare
Biden Nominates Fed Chair Powell for Second Term Amid US Inflation Scare
Sputnik International
WASHINGTON (Sputnik) - Federal Reserve Chairman Jerome Powell has been nominated for another four-year term while Fed Governor Lael Brainard, who was tipped to... 22.11.2021, Sputnik International
2021-11-22T16:40+0000
2021-11-22T16:40+0000
2022-08-06T13:26+0000
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Biden explained his choice in a Twitter post. Jerome Powell "is the right person to see us through" the pandemic recovery and the fight against inflation, Biden said as he nominated Powell for a second term. POTUS also called for the Fed to "be a leader among central banks globally in addressing climate-related financial risks" as the United States deals with extreme weather events and transitions to increasing reliance on green energy sources.The renomination of Powell, a Republican appointed by former President Donald Trump, comes after one of the most tumultuous periods ever for both the American economy and its central bank emerging from the COVID-19 pandemic and the recession triggered by that.Powell’s reappointment had been opposed by the far-left political wing of Biden’s Democratic establishment, which have criticised the Fed chair for lax regulations at the central bank. Brainard, a Democrat serving as Fed governor and an advocate of climate issues in banking regulation and monetary policy, had been strongly rumoured for months to replace Powell. Both will have to sit through Senate hearings to confirm the presidential decision.Biden, a Democrat in office since January, acknowledged the role played by both Biden and Brainard in helping the US recovery from the pandemic."Fundamentally, if we want to continue to build on the economic success of this year we need stability and independence at the Federal Reserve," Biden said in a statement issued by the White House. "And I have full confidence after their trial by fire over the last 20 months that Chair Powell and Dr. Brainard will provide the strong leadership our country needs."Both Powell and the Fed have taken intense criticism over inflation running at its highest levels in over 30 years in the US economy which has been caught up in supply chain bottlenecks in the aftermath of the COVID-19 crisis.The US economy shrank by 3.5% for all of 2020 due to shutdowns and other disruptions caused by the pandemic. Growth this year has been spotty, with an annualized 3.5% expansion in the first quarter, 3.6% in the second and 2.0% in the third.The Fed announced in March that it expected a 6.5% economic expansion for all of 2021 and has not changed its target despite the uneven growth in the past three quarters. The problem for the central bank though is inflation as wages and the prices of almost everything have soared from the lows of the pandemic.The Labor Department reported earlier this month that the US Consumer Price Index, which represents a basket of products ranging from gasoline and health care to groceries and rents, rose 6.2% during the year to October. It was the fastest growth of the so-called CPI since November 1990, an acceleration driven mostly by pump prices of fuel running at seven-year highs.Powell and Fed officials who share his thinking have described current price pressures in the economy as "transient", meaning things could return to normal once labour and materials supply get sorted out and normalized. The Fed’s own tolerance for inflation is supposed to be at just 2% per annum.Biden echoed his confidence in Powell and Brainard on getting inflation back on track, saying their "focus on keeping inflation low, prices stable, and delivering full employment will make our economy stronger than ever before".Powell and the Fed have also taken heat lately over an ethics scandal where several officials of the central bank were found to have engaged in trading stocks at a time when the institution was implementing policies aimed at boosting markets. Powell himself disclosed that he owned municipal bonds, which the Fed also was buying, and he also bought and sold funds tied to the broad stock market indexes.The Fed has launched a probe into the securities holdings and conduct of its officials since the scandal broke out, promising full transparency and assurance that the integrity will not be questioned in a similar fashion in the future.
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Biden Nominates Fed Chair Powell for Second Term Amid US Inflation Scare
16:40 GMT 22.11.2021 (Updated: 13:26 GMT 06.08.2022) WASHINGTON (Sputnik) - Federal Reserve Chairman Jerome Powell has been nominated for another four-year term while Fed Governor Lael Brainard, who was tipped to replace him, will become vice chair at the US central bank, President Joe Biden announced on Monday.
Biden explained his choice in a Twitter post.
Jerome Powell "is the right person to see us through" the pandemic recovery and the fight against inflation, Biden said as he nominated Powell for a second term. POTUS also called for the Fed to "be a leader among central banks globally in addressing climate-related financial risks" as the United States deals with extreme weather events and transitions to increasing reliance on green energy sources.
The renomination of Powell, a Republican appointed by former President Donald Trump, comes after one of the most tumultuous periods ever for both the American economy and its central bank emerging from the COVID-19 pandemic and the recession triggered by that.
Powell’s reappointment had been opposed by the far-left political wing of Biden’s Democratic establishment, which have criticised the Fed chair for lax regulations at the central bank. Brainard, a Democrat serving as Fed governor and an advocate of climate issues in banking regulation and monetary policy, had been strongly rumoured for months to replace Powell. Both will have to sit through Senate hearings to confirm the presidential decision.
Biden, a Democrat in office since January, acknowledged the role played by both Biden and Brainard in helping the US recovery from the pandemic.
"Fundamentally, if we want to continue to build on the economic success of this year we need stability and independence at the Federal Reserve," Biden said in a statement issued by the White House. "And I have full confidence after their trial by fire over the last 20 months that Chair Powell and Dr. Brainard will provide the strong leadership our country needs."
Both Powell and the Fed have taken intense criticism over inflation running at its highest levels in over 30 years in the US economy which has been caught up in supply chain bottlenecks in the aftermath of the COVID-19 crisis.
The US economy shrank by 3.5% for all of 2020 due to shutdowns and other disruptions caused by the pandemic. Growth this year has been spotty, with an annualized 3.5% expansion in the first quarter, 3.6% in the second and 2.0% in the third.
The Fed announced in March that it expected a 6.5% economic expansion for all of 2021 and has not changed its target despite the uneven growth in the past three quarters. The problem for the central bank though is inflation as wages and the prices of almost everything have soared from the lows of the pandemic.
The Labor Department reported earlier this month that the US Consumer Price Index, which represents a basket of products ranging from gasoline and health care to groceries and rents, rose 6.2% during the year to October. It was the fastest growth of the so-called CPI since November 1990, an acceleration driven mostly by pump prices of fuel running at seven-year highs.
Powell and Fed officials who share his thinking have described current price pressures in the economy as "transient", meaning things could return to normal once labour and materials supply get sorted out and normalized. The Fed’s own tolerance for inflation is supposed to be at just 2% per annum.
Biden echoed his confidence in Powell and Brainard on getting inflation back on track, saying their "focus on keeping inflation low, prices stable, and delivering full employment will make our economy stronger than ever before".
Powell and the Fed have also taken heat lately over an ethics scandal where several officials of the central bank were found to have engaged in trading stocks at a time when the institution was implementing policies aimed at boosting markets. Powell himself disclosed that he owned municipal bonds, which the Fed also was buying, and he also bought and sold funds tied to the broad stock market indexes.
The Fed has launched a probe into the securities holdings and conduct of its officials since the scandal broke out, promising full transparency and assurance that the integrity will not be questioned in a similar fashion in the future.
