Biden announces black and Latino candidates for top Federal Reserve spoits trends now
President Joe Biden nominated Philip Jefferson, a member of the Federal Reserve's Board of Governors, to serve as vice chair of the board, the White House announced Friday.
Biden has also chosen Adriana Kugler, a Georgetown University economist, to join the Fed's board. If confirmed by the Senate, she would become the first Hispanic American on the Fed's interest-rate-setting committee and Jefferson, if confirmed, would become the second Black man to serve as the Fed's No. 2 official.
The board of the central reserve remains overwhelmingly white but the nominations of Jefferson and Kugler further transform the diversity of the bank's leadership in just two years.
The nominations come as the Fed opens a new chapter in its battle against an increasingly fraught economy marked by rising interest rates, still-high inflation and a shaky banking system.
Philip Jefferson, if confirmed by the Senate, would become the second Black man to serve as the Fed's No. 2 official
Since March 2022, the Fed has raised its benchmark interest rate 10 times, to the highest level in 16 years, in an aggressive drive to cool price increases.
After a policy meeting last week, Chair Jerome Powell signaled that the Fed may now pause its rate hikes.
Central bankers want policy tight enough to bring down inflation, now running at more than twice their 2% goal, but not so tight it craters a labor market that so far has weathered the steeper borrowing costs with surprising strength. Finding that balance will be a tricky task.
In the coming months, the Fed will face tough decisions about whether to keep rates unchanged for the rest of this year or resume raising them. Fed officials could also come under pressure to cut rates should a recession occur later this year, as many economists expect.
Jefferson, 61, who first joined the Fed's board just a year ago, would replace Lael Brainard, who left in February to become Biden's top economic adviser.
As vice chair, Jefferson would join an inner circle of policymakers that includes Powell and the president of the Federal Reserve Bank of New York, John Williams.
Kugler, 53, who has a background in international and labor economics, is on leave from Georgetown to serve as the United States' representative on the board of the World Bank. During the Obama administration, she was the Labor Department's chief economist, from September 2011 to January 2013.
Biden also announced that he plans to re-nominate Lisa Cook to a full 14-year term on the Fed's board. Cook, 58, who was narrowly confirmed by the Senate, joined the board last May to fill an unexpired term that will end on Jan. 31, 2024.
'These nominees understand that this job is not a partisan one, but one that plays a critical role in pursuing maximum employment, maintaining price stability and supervising many of our nation´s financial institutions,' Biden said in a statement.
After the Fed´s policy meeting last week, Powell said that while inflation remains far above the Fed´s 2% target, turmoil in the banking sector could lead to tighter credit for businesses and households and weaken the economy. That could allow the Fed to end its rate-hiking campaign.
Biden´s choice of Kugler follows long-standing demands by Sen. Robert Menendez, a New Jersey Democrat, that a Latino be chosen for the rate-setting committee for the first time in the Fed´s 109-year history. Menendez voted last year against Biden´s nomination of Powell for a second
