Biden to keep Powell as Fed chair, Brainard gets vice chair
President Joe Biden announced he’s nominating Jerome Powell for a second term as Federal Reserve chair, endorsing Powell’s stewardship of the economy through a brutal pandemic recession in which the Fed’s ultra-low rate policies helped bolster confidence and revitalize the job market.
A potential Powell renomination for Fed faces some dissent
Resistance to the potential renomination of Federal Reserve Chair Jerome Powell intensified this week, with Sen. Elizabeth Warren becoming the first senator to publicly oppose Powell and many progressive groups pushing for some alternative leader at the Fed.
Rosengren: Fed should begin slowing stimulus efforts by fall
The president of the Federal Reserve Bank of Boston added his voice to a growing number of people, inside and outside the Fed, who say the central bank should soon begin to dial back its extraordinary aid for an economy that is strongly recovering from the pandemic recession.
Top Fed official says Fed far from achieving its goals
A top Federal Reserve official says the outlook for the U.S. economy is bright but the recent jobs report is a reminder that the path of the recovery is likely to be uneven and difficult to predict. Lael Brainard, a member of the Fed's board, said Tuesday in a virtual conference sponsored by the Society for Advancing Business Editing and Writing, that employment and inflation remain far from the Fed's goals. The Fed has said it will not start raising interest rates until it has achieved maximum employment and annual prices gains that have not only hit the Fed's 2% target, but exceeded that target for a period of time.news.yahoo.com
Fed sets up panels to examine risks that climate change poses to the financial system
The Federal Reserve has taken another step forward in efforts to ensure that the financial system is protected against climate risks. As the central bank turns its attention increasingly toward the matter, the Fed has created a Financial Stability Climate Committee and a Supervision Climate Committee. The panels will focus on "the potential for complex interactions across the financial system," Fed Governor Lael Brainard said in remarks Tuesday. "Climate change and the transition to a sustainable economy also pose risks to the stability of the broader financial system. The Financial Stability Climate Committee will address "macroprudential risks" for how climate could pose systemic risks to the institutions the Fed supervises.cnbc.com
Why the pandemic left long-term scars on global job market
But when the pandemic slammed the U.S. economy a year ago, it swept away her job — and millions of others. Getting back the jobs lost to the pandemic is likely to prove a struggle. Even as viral vaccines increasingly promise a return to something close to normal life, the coronavirus seems sure to leave permanent scars on the job market. Millions of jobs lost likely won't come back — especially at employers that require face-to-face contact with consumers: Hotels, restaurants, retailers, entertainment venues. Jamison wonders whether the front desk operation will eventually be eliminated, the jobs lost as guests use keys on their smartphones to go straight to their rooms.
Why the pandemic left long-term scars on global job market
Even as viral vaccines increasingly promise a return to something close to normal life, the coronavirus seems sure to leave permanent scars on the job market. No one knows exactly what the job market will look like when the virus finally ends its rampage. The U.S. Labor Department, too, has tried to estimate the pandemic’s likely impact on the job market. Before taking the pandemic into account, the department last year projected that U.S. jobs would grow 3.7% between 2019 and 2029. “At this point," she said, “they have to move on with their lives.”Jamison wonders whether the front desk operation will eventually be eliminated altogether, the jobs lost to automation.
Asian shares track Wall St decline as bond yields rebound
Asian shares fell Thursday, tracking a decline on Wall Street as another rise in bond yields rattled investors who worry that higher inflation may prompt central banks to raise ultra-low interest rates. (AP Photo/Ahn Young-joon)BANGKOK – Asian shares fell Thursday, tracking a decline on Wall Street as another rise in bond yields rattled investors who worry that higher inflation may prompt central banks to raise ultra-low interest rates. Shares have yoyo'd recently with fluctuations in bond yields. When yields rise quickly, as they have in recent weeks, it forces Wall Street to rethink the value of stocks. U.S. government bond yields rose Wednesday after easing a day earlier.
Asian shares advance despite Wall Street retreat
Stocks advanced in Asia on Wednesday after a wobbly day on Wall Street, when the S&P 500 gave back most of its gains from a day earlier. (AP Photo/Eugene Hoshiko)BEIJING – Stocks advanced in Asia on Wednesday after a wobbly day on Wall Street, when the S&P 500 gave back most of its gains from a day earlier. Investors have taken heart from an easing in bond prices that has alleviated worries over possible interest rate hikes. But expectations for stronger economic growth in coming months continue to fuel worries that interest rates will head higher. Higher interest rates force investors to rethink how much they’re willing to pay for stocks, making each $1 of profit that companies earn a little less valuable.
Stocks are flat after S&P 500 notches best day since June
U.S. stocks held steady on Tuesday after the S&P 500 rallied more than 2% in the previous session for its best day since June. The S&P 500 was flat and the tech-heavy Nasdaq Composite dipped 0.1%. The 10-year Treasury yield, a point of focus lately for equity investors, was flat at 1.45%. All 11 S&P sectors finished in the green and the S&P 500 posted its best day since June 5. Both the Dow and the Nasdaq clinched their best trading day since November.cnbc.com
Stocks jump on stimulus vote and J&J vaccine news, with Dow up 600 points
Stocks rose across the board Monday on Wall Street as traders welcomed a move lower in long-term interest rates in the bond market. Investors also watched Washington, D.C., as a big economic stimulus bill moved to the Senate. The Dow Jones Industrial Average was up a little over 600 points, or nearly 2%, to 31,535, and the tech-heavy Nasdaq composite rose 3%. Higher interest rates can slow the economy and discourage borrowing. Investors will get several big economic reports this week, including February's jobs report on Friday.cbsnews.com
Stocks jump on stimulus vote and J&J vaccine news, with Dow up nearly 700 points
Stocks are rising across the board on Wall Street as traders welcomed a move lower in long-term interest rates in the bond market. Investors were also watching Washington as a big economic stimulus bill moved to the Senate. The Dow Jones Industrial Average was up about 675 points, or nearly 2.2%, to 31,606 and the Nasdaq Composite rose 2.6%. Higher interest rates can slow the economy and discourage borrowing. Investors will get several big economic reports this week, including February's jobs report on Friday.cbsnews.com
Asian stocks mixed after Wall St. rises
A man walks past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange in Hong Kong Tuesday, March 2, 2021. Asian stock markets were mixed Tuesday after Wall Street rose as investor concern about possible higher interest rates receded. (AP Photo/Vincent Yu)TOKYO – Asian stock markets were mixed Tuesday after Wall Street rose as a wave of investor concern about possible higher interest rates receded. Market benchmarks in Tokyo, Shanghai and Hong Kong declined. The Hang Seng in Hong Kong lost 0.2% to 29,405.45.
Yellen reportedly looking to name climate 'czar' at Treasury
Treasury Secretary Janet Yellen is looking to appoint someone to monitor the risks that climate change pose to the financial system, The Wall Street Journal reported Friday. Yellen reportedly is eyeing Sarah Bloom Raskin, former deputy Treasury secretary during the Obama administration, to tackle the role. During her Senate confirmation hearing, Yellen stressed the need to address the risks climate change pose. However, efforts from the administration and other bodies to expand their mandate into climate change have received pushback from congressional Republicans, who worry about potential overreach. The latest round of stress tests the Fed will impose on the 19 largest banks does not include provisions related to climate change.cnbc.com
Powell signals Fed will keep aiding economy with bond buying
Powell also stressed that the Fed probably won't raise its rate until inflation has topped 2% for some time. The speculation was fueled by comments from several regional Fed bank presidents, including Raphael Bostic of the Atlanta Fed and Robert Kaplan of Dallas. Bostic said last week that he was “hopeful that in fairly short order we can start to recalibrate” the bond purchases. And Lael Brainard, another governor, said Wednesday that the current level of bond buying “will remain appropriate for quite some time.”Some regional Fed bank presidents have signaled that any reduction in bond purchases is probably a long way off. Still, Powell also said he was quite optimistic that the economy would rebound later this year, once COVID-19 vaccines are widely distributed.
The unemployment rate is above 20% for the lowest-paid workers, Fed's Brainard says
Federal Reserve Board Governor Lael Brainard speaks at the John F. Kennedy School of Government at Harvard University in Cambridge, Massachusetts, U.S., March 1, 2017. Unemployment for the lowest-paid workers in the U.S. is above 20%, a figure that Federal Reserve Governor Lael Brainard said underscores the importance of policy help for the economy. At a time when the national unemployment rate has come down from the pandemic peak of 14.7% to the current 6.7%, Fed economists estimate the jobless rate for the lowest quartile of earners is "likely above 20%," Brainard said. That comes as the Black unemployment rate is 9.9% and the Hispanic rate is at 9.3% while the rate for Whites is 6%. Brainard did not commit to a time frame for policy adjustments but noted that "the economy remains far from our goals."cnbc.com
Fed transcripts show doubts about need for 2015 rate hike
Newly released transcripts show that many Federal Reserve officials had concerns in late 2015 over whether they were making a mistake in raising a key interest rate for the first time in nearly decade. Fed board member Lael Brainard also expressed doubts about the need for a rate hike given the low inflation, but said she would go along with the modest increase. That increase was followed by three quarter-point rate increases in 2017 as economic growth increased and the unemployment rate fell further. The Fed raised rates four times in 2018 after Yellen was replaced by Jerome Powell as Fed chair by President Donald Trump. Trump launched an unprecedented attack on the Fed’s rate hikes fearing negative affect on economic growth, breaking with the practice of past presidents to respect the Fed’s independence.
Senate confirms Christopher Waller to serve on Fed's board
WASHINGTON – The Senate on Thursday narrowly confirmed the nomination of Christopher Waller for the Federal Reserve's Board of Governors, placing another of President Donald Trump's picks on the Fed's influential board after a string of high-profile rejections. Waller had won some Democratic votes when the Senate Banking Committee approved his nomination in July. And some worried that Waller would agree with the Fed's recent moves to loosen regulations on large banks. With Waller's confirmation by the Senate, four of the Fed's six governors have now been chosen by Trump. Trump’s two previous picks for the Fed's board, Stephen Moore and Herman Cain, ran into so much opposition that they withdrew from consideration before their nominations came before the Senate.
Biden says he's decided on treasury secretary nomination
WASHINGTON – President-elect Joe Biden said Thursday that he has decided whom to nominate as his secretary of the Treasury Department. Either would be the first woman to serve as treasury secretary. Both Bostic and Ferguson are Black, and either would be the first Black treasury secretary. Brainard also advised President Bill Clinton and was floated as a potential treasury secretary if Hillary Clinton had won the 2016 election. He says, “They all acknowledge this is going to take a massive education campaign.”Biden’s treasury secretary would lead his economic team as many businesses and Americans struggle while the pandemic continues.
Joe Biden made his pick for Treasury secretary, says he will announce choice soon
WASHINGTON – President-elect Joe Biden said Thursday that he has decided whom he will nominate for Treasury secretary, and that he will make the announcement in the coming weeks. "You'll soon hear my choice for Treasury, either just before or just after Thanksgiving," Biden told reporters in Wilmington, Delaware. Going into Thursday, Biden's team had signalled to allies in the business community that he had whittled down his list of options for Treasury secretary to at least three names, according to people briefed on the matter. Either Brainard or Yellen would be the first female Treasury secretary. "The way the federal reserve has been approaching dealing with the dollar, I think has been in a positive direction," said Biden.cnbc.com
Fed's Brainard urges greater diversity in field of economics
WASHINGTON – A Federal Reserve official widely considered a front-runner to be tapped as President-elect Joe Biden's Treasury Secretary is urging universities and government agencies to make the field of economics more inclusive. Lael Brainard, a member of the Federal Reserve’s board of governors, noted Tuesday that the economics field is less diverse than other professions, such as law and medicine. Brainard noted that black women earned just 1.5% of undergraduate economics degrees from 2011 through 2015, far below their 6.2% share of all undergraduate degrees. Blacks and Latinos are also less likely to earn doctorates in economics than they are to receive medical degrees. She has served on the Fed's board since 2014 and was previously mentioned as a potential Treasury Secretary if Hillary Clinton had been elected in 2016.
The Fed is set to take on a new challenge: climate change
In recent days, several central bank officials have spoken about the importance of taking climate change into effect when considering dangers posed to the system. Along with that, the Fed's financial stability report, which usually talks about how economic and market forces could impact banks, insurance companies and other firms, mentioned climate for the first time. In a statement accompanying the report, she noted that "climate change poses important risks to financial stability." Fed Chairman Jerome Powell also addressed the issue recently, noting at his post-meeting news conference a week ago that "incorporating climate change into our thinking about financial regulation is relatively new, as you know. "Until recently, the financial regulators in the United States haven't been seen as real leaders in climate.cnbc.com
Fed survey finds tepid growth as US economy battles pandemic
The Fed report made public Wednesday said that the pace of activity varied greatly among sectors of the U.S. economy. “Restaurants in many districts expressed concern that cooler weather would slow sales as they have relied on outdoor dining,” the Fed report said. The Fed survey said that businesses reported only modest price increases with “notable exceptions.” Prices were up significantly for things such as food, autos and appliances, a development that has been linked to shortages stemming from the coronavirus. The Fed report was based on responses gathered by the Fed's 12 regional banks before Oct. 9. Congress so far has been unable to reach a compromise and provide another package of economic support for individuals and businesses.
A Fed official who could be Biden's Treasury secretary says Congress needs to pass stimulus to save the recovery
"Further targeted fiscal support will be needed alongside accommodative monetary policy to turn this K-shaped recovery into a broad-based and inclusive recovery," she added. These disparities risk holding back the recovery," Brainard said remarks to the Society of Professional Economists. Federal Reserve Governor Lael Brainard issued a call Wednesday for more fiscal support from Congress, saying more stimulus is needed to address a recovery that has left out large parts of the economy. "Continued targeted support to replace lost incomes will be an important factor in determining the strength of the recovery," Brainard said. "Apart from the course of the virus itself, the most significant downside risk to my outlook would be the failure of additional fiscal support to materialize."cnbc.com
Europe's central bank moves toward introducing digital euro
The central bank issued a comprehensive report outlining the reasons why it might need to take the step. It said no decision has been made, and that any digital euro would complement cash, not replace it. We should be prepared to issue a digital euro, should the need arise.”A digital euro would be different from current cashless payment systems run by the private sector because it would be official central bank money - trustable, risk-free and likely less expensive to use. A central bank digital currency could also be used offline, for instance, to transfer small amounts between individuals using digital wallets on their smartphones and a Bluetooth connection. China’s central bank is already testing an official digital currency, while the central bank of Sweden says it has initiated a pilot project.
Federal Reserve to meet after sharp changes to its outlook
WASHINGTON – Federal Reserve policymakers will meet this week for the first time since they significantly revised the Fed's operating framework in ways that will likely keep short-term interest rates near zero for years to come. As a result, analysts expect the Fed will keep its benchmark rate unchanged after the two-day meeting that ends Wednesday. Analysts expect they will show that the Fed foresees keeping its benchmark rate at nearly zero through 2023. Instead, low unemployment and even rising wages no longer necessarily push up inflation, Fed officials believe. With most consumers and businesses accustomed to mild price increases, they have adjusted their behavior in ways that act to keep inflation low.
Fed wrestles with its next moves as virus stalls US economy
Economists call such an approach forward guidance, and the Fed used it extensively after the 2008-2009 recession. The Fed probably won't provide such guidance until its next meeting in September, economists say. Some Fed watchers expect no rate increase until 2024 at the earliest given their bleak outlook for the economy and expectations of continued ultra-low inflation. The Fed also launched nine lending programs to enable businesses and Wall Street banks to borrow at low rates. In recent speeches and appearances, Fed policymakers have sounded largely pessimistic about the economy.
Federal Reserve seeks banks' advice as it gets into direct lending with coronavirus relief
The Federal Reserve has reached out to investment and retail banks for feedback on its Main Street lending program ahead of its formal launch, according to people familiar with the matter. In addition to speaking to investment and retail banks, it has also talked to its reserve banks and received more than 2,200 pieces of feedback online. The Fed has said it will roll out more detailed guidelines pertaining to its Main Street program "soon," but not yet given an official time frame. Lael Brainard, a member of the Federal Reserve Board of Governors, is helping to lead the program, one of the people said. Yet her involvement in the Main Street program may help soothe some partisan tensions as there is heightened scrutiny of loans being given to larger companies.cnbc.com
Fed's Lael Brainard says she wants to wait and see how economy is doing before moving rates again
Federal Reserve Governor Lael Brainard said Wednesday she wants to see how the U.S. economy is performing before making changes to the central bank's current stance on monetary policy. The adjustment Brainard refers to is the three rate cuts by the U.S. central bank this year. Those rate cuts followed four rate hikes in 2018, the last of which contributed to a massive sell-off in U.S. stocks. Back then, Chairman Jerome Powell raised the bar for further rate cuts but noted the Fed remains a long way from hiking rates any time soon. WATCH: CNBC's full interview with the Fed's Lael Brainardcnbc.com