Federal Reserve Chairman Jerome “Jay” Powell was confirmed to a second four-year term in office by the Senate on Thursday.
Powell, 69, won overwhelming bipartisan backing from the upper chamber with a vote of 80-19.
First appointed by Barack Obama to the Fed’s Board of Governors in 2012, he was elevated to the Chair role by Donald Trump in 2018 as a consensus Republican nominee to replace then-Chair Janet Yellen and was confirmed in a vote of 84-13. President Joe Biden renominated him to the role late last year, being one of a handful of top-level Trump appointees retained by the Biden Administration (the other being U.S. Ambassador to Russia John J. Sullivan).
Powell’s term as Chair formally expired on February 18, but he has continued in the role as Chair pro tempore, designated by the remainder of the Board of Governors. Alongside his chairmanship, he is serving a 14-year term as a Federal Reserve Governor, which expires in 2028.
Powell’s reappointment comes as the Federal Reserve plans to raise interest rates in response to record inflation, which currently stands at 8.3 percent, the highest in over 40 years. On April 21, Powell announced his intention to hike rates by 0.5 percent or 50 basis points, the highest increase in over 22 years, which led to massive losses in financial markets.
The margin of his confirmation vote is being interpreted as a broad political endorsement of his approach.
Still, some had questioned Biden’s renomination of Powell to the top spot, including many progressives in Congress. Representative Alexandria Ocasio-Cortex (D., N.Y.) had called for Powell to be replaced, claiming that he wasn’t doing enough to “mitigate climate risk” and advance “racial and economic justice” through his policies. This was echoed by Senator Elizabeth Warren (D., Mass.) — a former financial regulator who has been vocal on banking issues — who called him a “dangerous man” for his past work as an investment banker and private equity executive. Warren was the sole vote against advancing his nomination on the Senate Banking Committee.
In 2019, Powell drew criticism from then-president Trump, who appointed him to the role, for raising interest rates in 2018 and 2019 as unemployment reached record lows — leading to unsuccessful attempts by Trump to remove him from office.
However, Trump later commended Powell for the Fed’s response to the coronavirus, which involved the central bank taking on over $5 trillion in bonds to sustain liquidity in the economy. Moreover, though Powell has promised rate hikes this year, he has been criticized by several economists for not acting fast enough to stem rising inflation.
The confirmation comes as Biden shakes up the composition of the Federal Reserve’s Board of Governors, each of whom have a vote on the Federal Open Market Committee, which controls interest rates. The Senate last month confirmed Lael Brainard, a Democratic Obama appointee and long-time Governor — who is married to Kurt Campbell, Biden’s Indo-Pacific regional coordinator on the National Security Council — to be vice chair.
It also confirmed two of Biden’s nominees, Philip Jefferson and Lisa Cook, to Board Governorships on May 11. Both will be the first African American man and woman, respectively, to join the Board — which will also split its composition evenly between three Democratic and three Republican governors.