Jerome Powell renomination for Fed chair backed by key Republican senators

White House still mum on potential Powell reappointment

Support for the potential renomination of Jerome Powell as chairman of the Federal Reserve is growing among key Senate Republicans, who have indicated they could help him earn a second term to lead the central bank despite fierce criticism from progressive lawmakers.

The White House is still mulling whether to tap Powell to lead the Fed for another four years – one of the most consequential economic decisions for President Biden – before his term officially ends in February 2022. Press secretary Jen Psaki has said Biden will make the decision with enough time to ensure the Senate can confirm the individual. 

Powell, a lawyer by training and a former Republican Treasury official, is generally respected on Wall Street and well-liked among lawmakers in both parties. The Fed chair – one of the most powerful players in Washington, with the ability to dictate the pace of economic growth – is typically nominated for a second term, often to reinforce the central bank's independence from politics. 

"Most of the people I’ve talked to on the Republican side support his renomination," Sen. John Kennedy, R-La., told reporters. "I can’t think of one person who opposes him."


Kennedy, who sits on the pivotal Senate Banking Committee, is among a group of at least eight Republican lawmakers who have indicated they would vote to confirm Powell if Biden nominates him for another term. That includes Sens. Thom Tillis of North Carolina, Steve Daines of Montana, Jerry Moran of Kansas, Mike Rounds of South Dakota, Chuck Grassley of Iowa and Kevin Cramer of North Dakota.

Their support could mean that Powell will be able to get confirmed in a 50-50 Senate, even as Biden is facing pressure from progressive lawmakers to replace the Fed chair, an appointee of former President Trump

Sen. Elizabeth Warren became the highest-profile lawmaker last month to oppose Powell's renomination, arguing that under his tenure, the central bank took "plenty of action to weaken" oversight of banks, including overhauling the Dodd-Frank Act's Volker Rule, revamping big-bank stress tests and allowing lenders to boost investments in venture capital. 

Elizabeth Warren Jerome Powell

Sen. Elizabeth Warren, D-Mass., talks to Federal Reserve Chairman Jerome Powell before a Senate Banking, Housing and Urban Affairs Committee hearing on the CARES Act on Capitol Hill, Tuesday, Sept. 28, 2021, in Washington. (Kevin Dietsch/Pool via AP) (Kevin Dietsch/Pool via AP / AP Newsroom)

"Your record gives me grave concern," Warren told Powell during a Senate Banking Committee hearing. "Over and over you have acted to make our banking system less safe. And that makes you a dangerous man to head up the Fed."

At the same time, Powell has reportedly secured a key endorsement from Janet Yellen, now the Treasury secretary, boosting his odds of a second term, given her nearly two decades of experience at the Fed, including four years leading the central bank. Yellen also has worked directly with Powell, who served as a governor at the Fed under her tenure. (In 2018, Powell replaced Yellen at the helm of the Fed, making her the first chair to not be reappointed after serving a first full term). 

The White House's decision comes as Fed policymakers grapple with how and when to start unwinding some of the ultra-easy monetary policies put in place to support the U.S. economy during the pandemic. Most Fed officials agreed last month they could begin slowing their aggressive bond-buying program as soon as mid-November, the first step they will take to dial back support for the U.S. economy.


Minutes from the U.S. central bank's Sept. 21-22 meeting show that policymakers are prepared to start gradually dialing back the $120 billion in monthly bond buys, a policy known as "quantitative easing" that's designed to keep credit cheap, as soon as next month. 

"Participants generally assessed that, provided that the economic recovery remained broadly on track, a gradual tapering process that concluded around the middle of next year would likely be appropriate," the minutes, released last week, said. "Participants noted that if a decision to begin tapering purchases occurred at the next meeting, the process of tapering could commence with the monthly purchase calendars beginning in either mid-November or mid-December."

Policymakers said they expect to conclude the tapering process by July of next year, about one or two months earlier than previously expected.

Economists widely expect Fed officials to announce tapering plans during their Nov. 2-3 meeting.