WASHINGTON — President Biden is close to two nominations to the Federal Reserve, according to people familiar with the process.
Biden is seeking to nominate Colombian economist Adriana Coogler, the U.S. Executive Director of the World Bank, as the Fed’s only remaining public office. A corresponding move is likely to promote economist Philip Jefferson, who was overwhelmingly approved by the board when Biden nominated him to the position of open governor, to become vice chairman of the board. .
The decision is not yet final.
A White House spokesman declined to comment on Monday. The Federal Reserve Board declined to comment.
If she is nominated and confirmed by the Senate, Coogler would fill the gubernatorial post recently vacated by Rael Brainard, who became director of the White House National Economic Council in February. .
The Fed’s board of directors consists of seven members, one serving as chair, one serving as vice chair, and one serving as vice chair for banking supervision. Mr. Brainard was Governor and Vice Chairman of the Fed.
The leadership change of the Fed, the world’s most powerful central bank and America’s main economic policy-making body, reflects a complex set of priorities that the Biden administration is trying to balance. , especially from New Jersey Sen. Bob Menendez, is under pressure to appoint Latinos or Latinas to the Fed’s board of directors.
Kugler was a former economist and administrator Georgetown University, was not on the list of potential candidates given by Democrat Menendez. But a spokesperson for Menendez said the senator’s priority is to elevate qualified Latinos or Latinas to his Fed’s board of directors, without commenting on specific candidates.
In the Fed’s 109-plus year history, there has never been a Latino on the Fed’s board of directors.
The Fed is also nearing a difficult policy tipping point as it slows the economy to keep inflation under control. Central bank vice-chairmen have traditionally played a key role both in communicating what the Fed is doing and in helping the chairman, in this case Jerome H. Powell, garner policy consensus. This may require someone with central bank experience. The job is tough because the Federal Reserve slows the economy, weakens the job market, and draws outrage from both progressive Democrats and, potentially, the general public if history is any guide. It may become something.
Jefferson appointed to the Fed last Mayis an economist, most recently an administrator at Davidson College and holds a PhD in economics from the University of Virginia. During his tenure at the Fed, he developed a reputation for being an inquisitive listener with an interest in his staff’s economic research.
Mr. Coogler will bring extensive knowledge of the labor market. She served as chief economist for the Labor Department during the Obama administration, a position she held from 2011 to 2013. She worked at the Faculty of Economics at the University of Houston and the University of Pompeu in Barcelona. She is from the University of California, Berkeley.
The governor of the Kansas City Federal Reserve Bank may soon assume another senior-level office on the Federal Reserve Board.
While the White House appoints the Fed’s public board leaders, the central bank’s 12 regional reserve banks nationwide are semi-private, with their leaders elected by community members and board business leaders.
Philip Swegel, head of the Congressional Budget Office, is on the shortlist for the job, according to people familiar with the matter. The Congressional Budget Office did not comment on Swagel’s candidacy, nor did the Kansas City Fed.
If he is elected and confirmed by the Fed’s board of directors, Mr. Swagel Vote Monetary policy in 2025. While the Fed’s president and New York branch manager vote on monetary policy all the time, other regional bank presidents rotate in and out of voting seats.
The Federal Reserve (Fed) will meet this week to decide whether to raise interest rates at a moment when the banking system is experiencing turmoil — the government said early on Monday that the First Republic would be bought by JP Morgan. has been announced — but inflation has also proven to be stubborn.
The central bank is expected to raise interest rates by a quarter of a percentage point, but is expected to keep them just above 5% in the coming months as the economy slows and unemployment rises. increase.
Due to economic conditions, the Fed’s nomination is extremely risky. Who fills vacant positions at the Fed could provide an important voice at the table as officials strike a delicate balance between keeping inflation under control and hurting the labor market. there is.
Economists broadly agree that it may take some economic pain to reverse the price rise, but how much and how quickly inflation must be reversed presents a difficult choice. I need.
“The challenge facing the Fed is significantly different than at any point in the last 40 years,” said Brelina Urchi, chief U.S. economist at T. Rowe Price. She said, “How do they safely land this economy in a state of equilibrium where inflation is stable and unemployment is low?”
