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Fed bans officials’ trading, with focus on Powell renomination -Breaking

by Mike Robinson

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© Reuters. FILE PHOTO – Jerome Powell, Federal Reserve Chairman, speaks during a Senate Banking, Housing and Urban Affairs Committee hearing about the CARES Act, in Washington, DC, U.S.A, September 28, 2021. Kevin Dietsch/Pool via REUT

WASHINGTON (Reuters] – On Thursday, the U.S. Federal Reserve banned individuals stock purchases by high ranking officials of its central bank. It also revealed a range of additional restrictions to their investing activities. The announcements of active trading by senior policymakers triggered an uproar about ethics.

Fed Chair Jerome Powell is out of office in February. President Joe Biden will soon announce if he plans to nominate Powell. Following sharp criticism by progressive Democrats as well as the Fed trading scandal, Powell’s odds on betting markets are down.

PredictIt, an online betting site gives Powell 75% chance to be confirmed by the U.S. Senate. This is down from a 95% chance on September 12th but up from 61% in September. After a September low point of 6%, 23% have now increased the chances that Federal Reserve Governor Lael brainard will get nominated.

COMMENTS

GREGORY DACO CHIEF U.S. ECONOMIST, OXFORD ECONOMICS, NEW YORK

    “I put the odds in favor of (Jerome Powell’s) nomination and this toughening of standards and rules works in his favor. It shows strong leadership, and an eagerness to make sure that Fed policymakers meet the highest standards.

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