Shelton Confirmation Likely, Powell Opines on Vaccine

On Thursday afternoon, Alaska Senator Lisa Murkowski announced she would support President Trump's controversial nominee for an open Fed Governor position, Judy Shelton. Christopher Waller, another but less controversial nominee, who was formerly Research Director at The Federal Reserve Bank of St. Louis, will likely be confirmed later. However, Senate majority leader Mitch McConnell has not yet moved Waller’s vote to the floor, as he has for Ms. Shelton. This all but assures her confirmation before the Senate as soon as next week. Shelton's past espousing of unorthodox views like opposing Federal deposit insurance for bank deposits, advocating a 0% inflation target, devaluing the US dollar to promote domestic industries, and denying that there was any legislative intent to make the Federal Reserve an independent agency led initially to fierce bipartisan opposition to her nomination. She had to sign a pledge not to devalue the US dollar to gain Senator Pat Toomey's support.

Jay Powell made an appearance with two of his foreign counterparts, ECB Chairman Christine LaGarde and Bank of England Gov. Andrew Bailey. Powell stuck to his well-known talking points of the need for more fiscal stimulus but also said it was too early to know what effects Pfizer's recent vaccine announcement would have on the path of the US and global economy. "From our standpoint, it's just too soon to assess with any confidence the implications of the news for the path of the economy, especially in the near-term," he said after mentioning that "The next few months could be challenging" due to the pace of rising coronavirus cases. He stated that the virus continued to be the primary risk to a continuation of the economic recovery.

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