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Warren, Brown Criticize Powell’s Approach on Bank Regulation

·2-min read

(Bloomberg) -- Senate Banking Chair Sherrod Brown and Senator Elizabeth Warren kept up criticism of Federal Reserve Chairman Jerome Powell over his stance on bank regulation as the Biden administration is turning to the question of whether the central bank chief should be reappointed.

“The chairman of the Federal Reserve has two obligations. One, to lead us in monetary policy, and the second, in regulating the largest financial institutions,” Warren told reporters on Capitol Hill when asked whether President Joe Biden should renominate Powell. “I have asked the chairman repeatedly from the time he was nominated about his views on regulation. I am concerned when I see the rules weakened rather than strengthened.”

The remarks follow a Banking Committee hearing last week when Brown and Warren, both vocal proponents of tougher banking rules, laid out a laundry list of grievances as Powell appeared before the panel.

Brown said Thursday he’s undecided whether he would support a second term for Powell as Fed chair. Like Warren, Brown said he was dissatisfied with Powell’s approach to regulation and is too close to Wall Street banks.

Brown said he’s talked with Treasury Secretary Janet Yellen, who will have a key role in Biden’s decisions on nominations to the central bank.

“I’ve met with Secretary Yellen, I’ve talked to a number of people,” Brown said. “I like what Chair Powell has done on monetary policy, I do not like what he’s done on regulation.”

He called Powell “overall a good chair” of the Fed, but said, “We know the damage that Wall Street has done to this economy a decade ago and long before that and I don’t want to see that repeated.”

Powell was appointed Fed chair by former President Donald Trump, and his term as chairman runs through February. He enjoys broad support for his renomination among top Biden advisers, though the decision on whether to renominate him is expected later this year and hasn’t yet been put in front of Biden, according to people familiar with the matter, Bloomberg reported Wednesday.

Even though many lawmakers have publicly complimented Powell’s leadership of the central bank, if prominent Democratic senators are opposed, or even lukewarm, it could spell trouble for his renomination for a second four-year term.

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