Jefferson confirmed as Fed Vice Chair, Cook gets another term

The full Senate has confirmed Governor Philip Jefferson to be the next Vice Chair of the Federal Reserve. As soon as he is sworn in, Jeffer will concurrently serve a four-year term as Vice Chair with his term as governor which expires January 31, 2036.

Also, the Senate has confirmed Governor Lisa Cook to a new term when her current term expires on January 31, 2024. Her term beginning on February 1, 2024 is for a full 14 years ending January 31, 2026.

Finally, Adriana Kugler is confirmed by the Senate to an unexpired term ending January 31, 2026. It is probable she will be sworn in before the September FOMC meeting.

The Board now has one holdover from the Obama Administration (Chair Jerome Powell) and three from the Trump years (Governor Christopher Waller, Vice Chair for Supervision Michael Barr), and Governor Michelle Bowman in the community banker spot. The Biden Administration appointees are governors Adriana Kugler, Vice Chair Philip Jefferson, and Lisa Cook.

The new duties for Jefferson, guaranteed next term for Cook, and addition of Kugler to the line up does not much change the outlook for monetary policy. The Board of Governors will soon be back to its seven member complement for the first time since February. This means that there will be a full 12 FOMC voters rather than the 11 at the past four meetings. It is unlikely that Kugler will change the balance on policy decisions or be a dissenting voice.

As a footnote, the search goes on for a successor to St. Louis Fed President James Bullard who retired in August. In 2023, the St. Louis Fed presidency is a nonvoter on the FOMC, so the absence of a sitting president for that district has no impact on the committee vote. Until a new president is named and seated, First Vice President Kathleen O’Neill Paese will be the voice of the St. Louis Fed at the FOMC meetings. In 2024, the St. Louis Fed is an alternate voter for the Atlanta district.