Wednesday, November 11, 2020

Powell's position threatened after Joe Biden's victory?

 U.S. monetary policy is not expected to be the main focus for President Joe Biden ahead of the January transition. After the Covid-19 crisis hit the U.S. economy, the Federal Reserve (The Fed) used major weapons through monetary and fiscal policy to revive the economy.

There are some questions about Biden's first year as President where he has to decide on the direction of the central bank and does Biden want to pursue the Fed's objectives set by Jerome Powell who wants to focus on job growth?

On that basis there is an expectation that Biden is likely to prefer to implement more progressive measures through the Fed by focusing on addressing issues such as gaps in the economy.

At the same time, there will be opposition to Powell among those who want stricter financial arrangements. In addition, U.S. Democratic Senator Elizabeth Warren is a strong opponent of Powell's candidacy in 2018. Some expect the Fed Governor Lael Brainar to replace Powell or become the next secretary of the U.S. Treasury.

In a presidential election decision, the Fed has stated that there will be no drastic changes in the near future.