Federal Reserve Chairman Jerome Powell testifies during a Senate Banking, Housing and Urban Affairs Committee hearing on the CARES Act, at the Hart Senate Office Building in Washington, DC, U.S., September 28, 2021.
Kevin Dietsch | Reuters
WASHINGTON – President Joe Biden said Tuesday that his administration will announce “fairly quickly” a nominee to chair the Federal Reserve, without specifying if he planned to renominate current chair, Jerome Powell.
Powell’s four-year term atop the Federal Reserve, one of the most powerful economic institutions in the world, is set to expire in February.
“We’ll be making those announcements fairly quickly,” the president said when asked about the apparent expiry of Powell’s tenure during a press conference following the United Nations Climate Change Conference, or COP26, in Glasgow, Scotland.
“I also would indicate that I think we’re gonna have plenty of time to make sure all the major nominees are able to be cleared in time where their terms would expire,” Biden added.
“I’ve given a lot of thought to it and I’ve been meeting with my economic advisors on what the best choices are and we got a lot of good choices, but I’m not going to speculate now,” the president said.
Treasury Secretary Janet Yellen told CNBC that she recently discussed the role with Biden, but would not disclose any specific plans. Yellen previously held the role under former Presidents Barack Obama and Donald Trump.
“I talked to him about candidates and advised him to pick somebody who is experienced and credible,” Yellen told CNBC’s Ylan Mui. “I think that Chair Powell has certainly done a good job.”
Traditionally, U.S. presidents keep the incumbent Fed chair despite administration and party changes in an effort to insulate the central bank from partisan politics.
However, Trump ditched the tradition in 2017 when he dumped then-chair Yellen and nominated Powell.
Janet Yellen (L) and Donald Trump (R).
Getty Images (L) | CNBC (R)
Under Powell’s economic stewardship, the Fed guided the U.S. to unemployment levels not seen in decades and initially won Trump’s praise. Powell became a political punching bag for Trump, however, whenever the economy hit a snag or when the Fed raised interest rates.
He is liked by both Senate Republicans and some Democrats, and his potential renomination would likely clear the Senate by a healthy margin.
More recently, Powell has had to wrangle the economy from the depths of the Covid-19 pandemic, including the loss of more than 20 million jobs. The Fed is also working to manage inflation, the result of supply-chain disruptions, labor shortages and overseas manufacturing delays.
The current Fed chief has also recently come under criticism following disclosures that he and regional presidents have been buying and selling securities tied to the stock and bond markets.
Sen. Elizabeth Warren, D-Mass., who sits on the Senate Banking Committee, is one of Powell’s most vocal critics and argues the central bank should do a better job overseeing banks.
“Over and over, you have acted to make our banking system less safe,” Warren told Powell during a committee hearing in September. “And that makes you a dangerous man to head up the Fed.”