NOVEMBER 29, 2021 –POWELL RENAMED FED CHAIR
In a Thanksgiving holiday shortened week, President Biden announced he would be reappointing current Federal Reserve President Jerome Powell to another term. Lael Brainard will serve as vice-chair.
The confirmation of Powell for a second term is to create continuity in an economic environment that is currently experiencing a large amount of uncertainty, from the pandemic to supply chain issues and a 30-year peak in inflation.
Fed officials have already said they will start reducing bond purchases, $15 billion per month, concluding in late spring or early summer of 2022. Most Fed officials have said they won’t consider raising rates until bond tapering ends. The Fed wants to proceed slowly but steadily to avoid any shocks.
Powell and Brainard feel rates should not rise until labor markets tighten up. But inflation is running well above the Fed’s 2 percent target, and there are questions over how long they can maintain that position before undermining the central bank’s credibility.