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Joe Biden has appointed Jay Powell as chairman of the Federal Reserve for a second term, choosing to continue at a time of crisis in the US economy as he faces rising inflation and the resumption of labor.
Lael Brainard, considered Powell’s main competitor for the top job, was elected second in the chair, a position currently held by Richard Clarida.
Biden praised Powell’s response to the coronavirus epidemic, its commitment to the Fed’s goal of all operations and pricing, and its protection of the “loyalty and integrity” of the central bank during Donald Trump’s tenure.
“We have the opportunity to address inflation from strength, not weakness,” Biden said.
The ruling comes just months after Biden’s decision to step down to replace the Fed. It comes at a time when the central bank is discussing how to improve its monetary policy in the face of volatility and rising inflation.
Both Powell and Brainard vowed to fight high prices. “We know that inflation is destroying families. . . “We will use our resources to support the economy and a strong labor market, as well as to prevent inflation,” Powell said.
Brainard added that it was committed to “reducing inflation at a time when people are more focused on their jobs and how their checks are paid” and “supporting a growing economy that includes everyone”.
This month, the Fed launches slope down its monthly $ 120bn procurement program, with the aim of eliminating all incentives for next summer.
But soon rising prices data, which shows consumer price growth in the US rising sharply over nearly three decades last month, has raised hopes that the Fed should lose its patient approach to monetary policy. speeding up “reducing” the bond-buying program before raising interest rates several times next year.
Biden did not nominate anyone to hold a minor position on the Fed board, including the deputy chairman, who is responsible for overseeing the banks. The White House said the election would begin in early December.
Powell, 68, was promoted to Fed seat by Trump in 2017 as governor since 2012 and has previously served as Treasury chief under George HW Bush. He was seen as a difficult decision for the Biden, especially since Powell’s double support could reduce his chances of securing a seat through the Senate.
Powell’s analysts also said that during such economic instability, a change in leadership could lead to unnecessary market volatility.
Leading up to the central bank’s response to the epidemic, Powell had the opportunity to curb market disruption and control the US economy through one of the most complex.
Following Powell, a Republican, Biden ignored it against the progressives about the regulator’s reputation for law enforcement, which led to what he called a reduction in post-financial regulation for major financial institutions.
Elizabeth Warren, the remaining Democratic senator in Massachusetts, said she opposed Powell’s election and voted for him. But he said he supported Biden’s Brainard nomination as vice-president. “Powell’s failure in management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the management of the administration of the management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system management system
Brainard opposed the reduction in the amount and amount required by US banks during Powell’s tenure, as well as changes to Volcker’s trade rules.
Following the announcement, a closer look at the interest rate market, the future of the eurodollar, showed that at least three quarters-interest rates were rising in value in December 2022. Two years of Treasury yields, which are accompanied by interest rates. , has risen sharply since March 2020.
Biden’s decision must be approved by the Senate. Earlier comments by lawmakers also suggested that Republicans should reopen Powell’s election.
Pat Toomey, Republican head of the Senate banking committee, said he had supported Powell’s assertion but did not insist on supporting Brainard, saying he was “concerned about the administrative policies that Governor Brainard could support”. His comments were confirmed by Kevin Cramer, another Republican on the banking committee.
Biden’s decision follows an unwavering commitment to the re-election of the Fed chairman who was in office for the first term – agreeing to continue the decision-making process and independence of the central bank.
Barack Obama re-elected Ben Bernanke to the Fed seat in 2009, when Bill Clinton did the same to Alan Greenspan in 1996. But Trump broke the mold four years ago when he elected Powell instead of giving Janet Yellen a second term.
Additional reports by Kate Duguid and Lauren Fedor
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