Biden should look to Britain and Europe for Federal Reserve reform
Analysis: The president’s compromise on monetary policy shows why it’s so important to avoid politicising such a key role, writes Phil Thornton
For Americans, their reaction to the stability at the top of their monetary policy regime may be a mix of relief and disappointment. Relief because Joe Biden has decided to nominate Federal Reserve chairman Jerome Powell for another term, thus avoiding another ugly fight in Congress with Republicans who would have been determined to retain Donald Trump’s appointee.
Disappointment because he had an opportunity to leave his mark by promoting Lael Brainard, a Fed governor of seven years’ standing and the favourite of the progressive wing of his Democrat party.
But for financial markets the overriding feeling is of a messy, unpredictable and highly politicised process.
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