(Businesshala) – President Joe Biden is still weighing whether to keep Jerome Powell as chairman of the Federal Reserve for a second term or promote Fed Governor Lyle Brainard to the position, an administration official said on Wednesday.
The White House is familiar with pressure from both moderates and progressives within the Democratic Party regarding the election. “There is pressure from both sides on both the finalists,” the official said.
Biden met with both candidates for the job last week, and a decision is expected in the coming weeks.
Powell, 68, who was appointed chairman by former President Donald Trump and whose four-year term ends in early February, is seen as a frontrunner.
He has the backing of moderate Democrats as well as Republicans, and a track record of averting a financial crisis and helping engineer an unexpectedly rapid and strong recovery from the pandemic downturn.
But he has also drawn criticism because supply constraints have driven inflation to a 31-year high, leaving millions of Americans without jobs, and a business scandal on his watch as the result of two Feds. Resignation of presidents and rewriting of central bank’s ethics rules.
Democratic Senator Elizabeth Warren opposed his nomination, and progressives are pushing for Brainard, 59, who was nominated to the board in 2014 by Democratic President Barack Obama after serving in his administration.
Brainard is seen as more liberal on monetary policy and a stronger hand on bank regulation. It is unclear how much support his nomination will receive from Republicans.
On online political betting site PredictIt.org, Powell remains the odds-on favorite at nearly 68%. Brainard’s stock is up 31%.
Regardless of his choice for the top Fed job, Biden will have a chance to shape the rest of the seven-member board. One seat is currently vacant. Governor Randall Quarles, most recently the Fed’s vice chair of oversight, plans to resign at the end of the year, and Vice Chair Richard Clarida’s term ends in January.
If Biden passes over Brainard to preside over the Fed, it could put him in Quarles’ old job, which he can use to write tougher rules for Wall Street and potentially be more active on climate change. approach, both are important priorities for progressives.