The Senate Banking Committee’s confirmation hearing for Jerome Powell to head the Federal Reserve was surprisingly congenial for what is often so contentious an appointment. Although several Republicans either did not show or questioned Mr. Powell harshly, his GOP support appears strong and Democratic opposition is relatively lackluster. We expect confirmation but likely not until late January or February so that senators can exercise as much influence as possible on the other financial-sector nominations still be made by President Trump. This report addresses Mr. Powell’s comments on issues ranging from monetary policy to economic equality to financial regulation. On monetary policy, Mr. Powell stands by decisions made by the Yellen FOMC. In response to Sen. Brown (D-OH), he said that the Fed has little sway over economic equality, but Mr. Powell did provide considerable insight on financial regulation. He generally supports the bipartisan Senate bill heading for mark-up next week (see FSM Report SIFI24), noting that the Fed will have technical suggestions and opposing any change to the SIFI threshold based solely on indicators without asset-size thresholds.
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