Biden to reappoint Jerome Powell as Fed chair, say economists

Saturday, July 17, 2021
Biden to reappoint Jerome Powell as Fed chair, say economists © Reuters. FILE PHOTO: Federal Reserve Chairman Jerome Powell testifies before the Senate Banking Committee hearing on Capitol Hill in Washington, U.S., December 1, 2020. Susan Walsh/Pool via REUTERS/File Photo

By Shrutee Sarkar and Howard Schneider

BENGALURU/WASHINGTON (Reuters) - U.S. President Joe Biden will reappoint current Federal Reserve Chair Jerome Powell for a second four-year term starting February next year, according to an overwhelming majority of economists polled by Reuters this week.

Powell took office from Janet Yellen as chair of the Board of Governors of the Fed in February 2018 and has had to maneuver the economy through its worst crisis since World War Two, battered by the COVID-19 pandemic which started early last year.

The White House will decide in coming months whether it wants Powell to remain but any decision to replace him could flare market reaction just as the U.S. economy is battling high inflation and employment activity is lagging the overall recovery. [ECILT/US]

Ninety percent of economists, or 36 of 40, in response to an additional question in the July 12-15 Reuters poll on the U.S. economy, said Biden would choose the status quo.

"It's (Powell's reappointment) likely at this point. Powell does have some strong competition, in particular from Lael Brainard, one of his colleagues as governor. She's the second most likely, but Powell is the favorite right now," said James Sweeney, chief economist at Credit Suisse (SIX:CSGN).

Jim O'Sullivan, chief U.S. macro strategist at TD Securities, agrees.

"I guess it's like a tradition. If you're seen as doing a decent job for continuity then the president kind of re-appoints, even if it was a president of a different party that appointed him in the first place," he said.

In congressional hearings this week Powell pledged "powerful support" to complete the economic recovery from the pandemic and said the Fed should stay focused on getting as many people back to work as possible. He also said the sudden spike in inflation was transitory.

Powell's focus on jobs has won praise from the Biden administration and among the broader community of Democratic policy analysts. A private equity lawyer promoted to Fed chair by Republican President Donald Trump, he has also won early endorsements for a second term from some congressional Republicans.

But those same hearings saw sharp questioning from members of both parties, offering an overview of the issues likely to frame debate over Powell's future. Republicans said they were worried recent high inflation might endure, and that Powell may be taking too lax an approach to it; some Democrats argued he has not been tough enough on large Wall Street banks.

A shift in the Fed's top job would come as the central bank is laying plans to phase out $120 billion in monthly bond purchases and handle the political debate around rising inflation pressure, both sensitive and potentially market-disrupting discussions.

Four economists in the Reuters poll said Biden would not reappoint Powell, with two of those predicting Lael Brainard, a member of the central bank's Board of Governors, would take over.

"It is a very close call. Powell has done a good job and works well with the U.S. Treasury, but we would not be surprised to see Joe Biden look to strengthen diversity at senior levels," said James Knightley, chief international economist at ING.

U.S. Treasury Secretary Janet Yellen and Powell were set to discuss the red-hot housing market and its risks with fellow regulators on Friday, to make sure the country is not vulnerable to a crash similar to the financial crisis in 2008.

A sudden relapse in house prices could pose another serious threat to the economy. In the meantime the highly infectious Delta variant that has become the dominant COVID-19 strain and further variations pose the top economic risk this year. [ECILT/US]

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27-07-2021 19:15:35 (UTC+7)

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EUR/USD

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Adidas AG

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 EUR/USD1.1810↑ Buy
 GBP/USD1.3813↑ Buy
 USD/JPY110.06↑ Sell
 AUD/USD0.7368Neutral
 USD/CAD1.2567Neutral
 EUR/JPY129.98↑ Buy
 EUR/CHF1.0806↑ Sell
 Gold1,803.05↑ Buy
 Silver25.277↑ Buy
 Copper4.5598↑ Buy
 Crude Oil WTI71.94Sell
 Brent Oil73.84↑ Sell
 Natural Gas4.055↑ Buy
 US Coffee C206.70↑ Sell
 Euro Stoxx 504,080.91↑ Sell
 S&P 5004,422.30↑ Buy
 DAX15,542.75↑ Sell
 FTSE 1006,994.75↑ Sell
 Hang Seng25,060.87↑ Buy
 Small Cap 20002,216.03↑ Buy
 IBEX 358,683.00↑ Sell
 BASF67.005↑ Sell
 Bayer50.60↑ Sell
 Allianz209.58↑ Sell
 Adidas312.02↑ Sell
 Lufthansa9.953Neutral
 Siemens AG133.03↑ Buy
 Deutsche Bank AG10.530↑ Sell
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank5,660/ 5,715
(-5/ -5) # 712
SJC HCM5,660/ 5,730
(-20/ -15) # 728
SJC Hanoi5,660/ 5,732
(-20/ -15) # 730
SJC Danang5,660/ 5,732
(-20/ -15) # 730
SJC Nhatrang5,660/ 5,732
(-20/ -15) # 730
SJC Cantho5,660/ 5,732
(-20/ -15) # 730
Cập nhật 27-07-2021 19:15:37
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ↀ Giá vàng thế giới
$1,801.40+3.470.19%
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ʘ Giá bán lẻ xăng dầu
Sản phẩmVùng 1Vùng 2
RON 95-IV2178022210
RON 95-II,III2168022110
E5 RON 92-II2049020890
DO 0.05S1637016690
DO 0,001S-V1672017050
Dầu hỏa1539015690
ↂ Giá dầu thô thế giới
WTI$71.94-0.17-0.24%
Brent$74.68-0.72-0.96%
$ Tỷ giá Vietcombank
Ngoại tệMua vàoBán ra
USD22.880,0023.110,00
EUR26.476,7927.854,49
GBP31.000,6032.295,52
JPY203,52214,19
KRW17,3221,08
Cập nhật lúc 18:50:40 27/07/2021
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