Home Business Fed Chairman Powell says he’s ‘everything in the fight against inflation’

Fed Chairman Powell says he’s ‘everything in the fight against inflation’

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‘World economy president’ without an economics degree
Director of U.S. Monetary Policy for Four More Years

Federal Reserve Chairman Jerome Powell speaks with US President Joe Biden behind him at the White House in Washington, DC, on the 22nd. President Biden announced the appointment of Chairman Powell and nominated Fed Director Rayle Brainerd as Vice Chairman of the Fed. Washington = AP News

Fed Chairman Jerome Powell (68), who has been re-appointed as the next chairman of the US Federal Reserve (Fed), has expressed his will to do everything in his power to respond to inflation, which has recently emerged as the biggest problem in the US economy.

President Joe Biden announced at a press conference at the White House on the 22nd (local time) that he would nominate incumbent Chairman Powell as the next Fed Chairman. As a result, Chairman Powell, whose term ends at the end of January next year, will lead the U.S. central bank for four more years. Fed Director Rayle Brainerd, 59, who had been discussed as a potential candidate for the next chairman along with Powell, was nominated as the next Fed vice chairman. The chairman of the Federal Reserve, the head of the central bank, oversees the US monetary policy and has a huge impact on the global economy. They are faced with the task of stabilizing the economy by managing prices and employment.

“We know that high inflation is hurting households that are unable to afford the high costs of necessities like food, housing and transportation,” Powell said in a statement. After graduating from Princeton University in Political Science and Georgetown University in Law, Chairman Powell began his career as a lawyer in the 1980s, working for major Wall Street investment banks. He served as Undersecretary of the Treasury under former President George W. Bush, and was appointed as the 16th Fed Chairman by former President Donald Trump in 2018, after being nominated by former President Barack Obama to the Fed Board in 2012. It was very unusual at the time for a person with no economics degree to come to the head of a Fed organization with more than 300 PhDs in economics. However, Chairman Powell was praised for successfully leading the US economy through strong stimulus measures, such as zero interest rates and asset purchase programs, in an unprecedented economic crisis of the novel coronavirus (COVID-19) pandemic. Classified as a ‘dove’ in monetary policy (preferring monetary easing), Chairman Powell is well-known as a Republican who favors deregulation. Thanks to the unique flexibility employed by both liberal and conservative governments, it is expected that the Senate approval will pass smoothly. Brainard’s nomination as the Fed’s ‘second-ranked’ vice-chairman is interpreted as a decision that arranged the voices of progressives within the Democratic Party. Brainard has shown bright progressive colors, such as urging the Fed to tackle climate change and introduce tougher financial regulations, and won support from leftists in the Democratic Party, including Senator Elizabeth Warren. Biden reportedly gave up his nomination for chairman, fearing he would face Republican opposition at the confirmation hearing. Brainard’s husband is Kurt Campbell, the ‘Asian Tsar’, the White House National Security Council Indo-Pacific Coordinator.

With Powell’s re-appointment, the U.S. has continued the practice of re-electing the Fed chairman appointed by the previous administration. New York stocks continued their gains on the news of Powell’s reappointment, but the index fell sharply after speculation that the Fed could raise interest rates sooner than expected to combat inflation. In particular, the tech-focused Nasdaq fell 1.3%.

The financial investment industry predicted that Chairman Powell’s reappointment would have a limited impact on the domestic financial market. Gong-rak, a researcher at Daishin Securities, said, “As the Fed has already provided a sketch of how to normalize monetary policy after Corona 19 through its declaration of the start of tapering, the impact of the reappointment on price variables will not be large.”

New York = Correspondent Yoo Jae-dong [email protected]
Reporter Park Min-woo [email protected]

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