The White House is still mulling the potential renomination of Jerome Powell as chairman of the Federal Reserve, one of the most consequential economic decisions for President Biden in his first term.
Powell's term officially ends in February 2022, but the White House had previously indicated it would make a decision by Labor Day. Press secretary Jen Psaki said Biden will make the decision with enough time to ensure the Senate can confirm the individual.
"The president will engage with his senior economic team in a careful and thoughtful process to appoint a Federal Reserve chair in a timely manner," a White House official told FOX Business.
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. Fed chairs – one of the most powerful players in Washington, with the ability to dictate the pace of economic growth – are typically nominated for a second term, often to reinforce the central bank's independence from politics.
In 2018, Powell replaced Janet Yellen at the helm of the Fed, making her the first chair to not be reappointed after serving a first full-term.
Biden is facing pressure from progressive lawmakers, including Rep. Alexandria Ocasio-Cortez, D-N.Y., and other "Squad" members, to replace Powell with someone "focused on eliminating climate risk and advancing racial and economic justice."
At the same time, Powell has reportedly secured a key endorsement from 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.
The White House's decision comes as Fed policymakers grapple with how to start unwinding some of the ultra-easy monetary policies put in place to support the U.S. economy during the pandemic. It's a difficult needle to thread, with Fed officials attempting to strike a delicate balance between surging inflation and the still-recovering labor market.
Fed policymakers in July committed to holding the benchmark federal funds rate at a range between 0% and 0.25%, where it has been since March 2020, and to keep purchasing $120 billion in bonds each month, a policy known as "quantitative easing" that's designed to keep credit cheap.
Although Powell indicated at the Fed's annual Jackson Hole symposium that he supported reducing monthly asset purchases sometime this year, that was before a lackluster August jobs report raised fresh concerns about a slowing economic recovery.
The Fed is holding a two-day meeting this week and will release an announcement Wednesday afternoon. That will be followed by a press briefing with Powell.
FOX Business' Edward Lawrence contributed to this report