Powell renominated as Fed chair, disappointing Democratic progressives

AFP

US Federal Reserve Chair Jerome Powell underscored his commitment to putting climate change at the center of the central bank's policymaking decisions during his conversations with President Joe Biden, the White House said on Monday.

Biden on Monday renominated Powell, a Republican, to another four-year stint at the helm of the Fed, disappointing Democratic progressives who had pushed the White House to name a tough new regulatory chief to crack down on banks on issues such as climate change and fair lending.

Speaking to reporters aboard Air Force One, press secretary Jen Psaki said the Fed had taken important steps forward under Powell, including identifying climate change as a key risk that needs to be addressed, working with other central banks to mitigate climate change, and hiring a top climate economist.

"He did reiterate his commitment to that during their discussions," Psaki said.

Psaki said Biden hopes to make decisions soon on how he would like to fill the seats that remain open on the Federal Reserve's Board of Governors.

"He is hoping to make decisions soon," she said.

Biden has three other Fed seats to fill, including the vice chair for supervision, and intends to pick those in early December, the White House said earlier on Monday.

Critics fault Powell for not moving more decisively to address climate change in his first term.

Treasury Secretary Janet Yellen, who held the top Fed job before Powell, told CNBC earlier the central bank was now gearing up to include analysis of climate change as part of its stress testing because it "poses a major risk to financial institutions."

"The Fed has made considerable strides on bringing evaluation of how climate risks affect the banks it supervises. It's doing very good work on that, and is gearing up ... to do scenario analysis of the risks facing the banks and to use it in supervision," Yellen said.