The Federal Reserve, as widely expected, left interest rates near zero following its latest policy meeting Wednesday. The Fed cut rates to that level in March and has maintained that they are likely to remain there for several years as the economy recovers from the Covid-19 pandemic.
The Fed has launched several lending programs and other stimulus efforts in addition to slashing interest rates this year to support the economy during the coronavirus crisis.
But Fed chair Jerome Powell has continued to stress that the Fed (as well as Congress and the White House) may need to do more to help struggling American consumers and businesses.
There are growing hopes that a new round of fiscal stimulus may be coming soon from politicians in Washington — and perhaps more will be done once President-elect Joe Biden takes office next month.
Biden will also need to decide sometime in 2021 whether or not he wants to keep Powell as head of the Fed or nominate someone else to lead the central bank.
Powell’s term ends in February 2022 and there has been speculation that current Fed governor Lael Brainard, who was rumored to be a Treasury Secretary candidate before Biden selected Powell’s Fed predecessor Janet Yellen, could one day succeed Powell.
Roger Ferguson, a former Fed vice chairman who recently announced plans to retire as CEO of investing firm TIAA, could also be a contender to take over the Fed. Ferguson would make history as the Fed’s first Black chairman.
