Goldman Sachs on Powell’s nomination as continuing Federal Reserve System Chair.
Its not a long note and the relevant part for policy implications is:
- Chair Powell and Governor Brainard have similar views on monetary policy. Both believe that the current rise in inflation reflects transitory (but not necessarily short-lived) factors, while emphasizing that the FOMC would use its tools to preserve price stability if needed. Powell and Brainard have also emphasized that they consider a broad set of indicators to gauge progress on the Fed’s broad and inclusive employment goal, although Powell indicated in November that maximum employment might look different from pre-pandemic conditions.
- The continuity in Fed leadership likely signals continuity in the current monetary policy stance, and we continue to expect liftoff shortly after tapering ends with the first hike in July 2022, the second in November, and a pace of two hikes per year thereafter.
GS add on the three current vacancies:
- Vice Chair of Supervision, the open Governor’s seat, and the seat left open by Governor Brainard. The White House has indicated that President Biden will make these appointments beginning in early December