Biden nominates Jerome Powell as head of the Federal Reserve

Who is Jerome Powell?

(2017 video) 2:14

(CNN) -

US President Joe Biden will re-nominate Jerome Powell as chairman of the Federal Reserve and Lael Brainard as vice president, according to a source familiar with the decision.

Biden is expected to speak later Monday about his decision to re-nominate Jerome Powell as chairman of the Federal Reserve and Lael Brainard as his vice president, the White House said.

The White House cited Powell's "firm leadership" amid the pandemic's economic turmoil as a reason for the decision.

The economic recovery, the White House said in a statement, “is a testament to the success of the president's economic agenda, and is a testament to the decisive action by President Powell and the Federal Reserve to cushion the impact of the pandemic and make America's economy back on track ".

"Powell has provided consistent leadership during an unprecedented challenging period, including the largest economic recession in modern history and the attacks on the independence of the Federal Reserve," the statement added.

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Meanwhile, on Brainard, the statement highlights that "he played a key leadership role at the Federal Reserve, working with Powell to help drive our country's strong economic recovery."

A second term for Powell

Powell's four-year term ended in February, and the president faced a key decision whether or not to keep Powell, who was put in office by a Republican, in the government's top economic policy post.

At a time when rising consumer prices, inflation, and shortages caused by the supply chain crisis are pressing concerns for the White House, more attention has been paid to who the president would choose to lead the banking system. central of the nation.

Biden recently met with the Federal Reserve's Powell and Lael Brainard separately at the White House while weighing his decision, CNN previously reported.

Brainard had been seen as the main contender if the president decided against Powell for a second term.

"We have a lot of good options," Biden said during a recent trip to Scotland.

The president said he had been meeting with his economic advisers and had "thought a lot" about who his next Fed chairman should be.

Powell, who will again need Senate confirmation to occupy the top job, has faced significant opposition from some progressive Democrats, who criticize his record on financial regulation.

Sen. Elizabeth Warren of Massachusetts said at a recent Senate hearing that Powell was a "dangerous man to head the Fed" and that he "regularly voted to deregulate Wall Street."

He said a Republican majority in the Fed under Powell's leadership could "bring this economy over a financial cliff again."

But some key democratic districts, like the unions, have shown their support for him.

Powell won Senate confirmation by an overwhelming majority for the job in 2018.

The president's appointment comes at a time of tumult on the Board of Governors and a business scandal that had threatened to prevent Powell from being elected to a second term.

The Fed recently unveiled sweeping changes to its ethical practices in response to the personal stock trading scandal by then-Fed regional chairmen Robert Kaplan and Eric Rosengren, who ran the Dallas and Boston reserves, respectively.

Both Kaplan and Rosengren announced early retirements amid criticism of their trades.

Who is Jerome Powell?

Powell, a Republican, was nominated to the Fed's Board of Governors by then-President Barack Obama.

He was elevated to the presidency by then-President Donald Trump in November 2017 to succeed Janet Yellen, who is now Biden's Secretary of the Treasury.

His term as a member of the Board of Governors does not expire until January 2028.

He has been leading a generalized emergency bailout in the market in response to the economic crisis that followed the coronavirus pandemic.

Although the US has made considerable progress, its economy beat expectations and added 531,000 jobs in October, there are still millions of people on the sidelines of a tight labor market.

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