Brainard Seeks Go-Soon CBDC Sure to Hit Powell, Political Speedbumps

Newly in place as Fed Vice Chair, Lael Brainard today made it clear at an HFSC full committee hearing that her prior statements laying out CBDC benefits are still her thinking despite the considerably more ambivalent approach outlined in the Fed’s discussion draft (see FSM Report CBDC10). This is not to say that Ms. Brainard endorsed a CBDC nor that she has solutions for the problems laid out in the discussion draft and those posed by members on both sides of the aisle.  She also made it clear that bringing forth a CBDC would be a multi-year process that should sustain the role of banks as financial intermediators and support private stablecoins under proper regulation.  Still, she outlined numerous benefits and ways to overcome problems, making it clear that she thinks a CBDC may well be warranted.