Fed Nominee Jerome Powell Signals Interest Rate Hike Likely Next Month Jerome Powell's confirmation hearing went smoothly, putting him closer to being confirmed as the Federal Reserve's next chairman. He suggested he'll continue the policies pursued under Janet Yellen.
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Trump's Pick For Fed Signals Interest Rate Hike Likely Next Month

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Trump's Pick For Fed Signals Interest Rate Hike Likely Next Month

Trump's Pick For Fed Signals Interest Rate Hike Likely Next Month

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ROBERT SIEGEL, HOST:

It didn't take long for Jerome Powell to make some news today during his confirmation hearing. He is President Trump's nominee to succeed Janet Yellen as Federal Reserve chair. Powell signaled to senators that the Fed is likely to raise interest rates at its meeting this month. And that's the part that made news. NPR's John Ydstie reports that Powell also avoided any missteps today.

JOHN YDSTIE, BYLINE: Jerome Powell has been a member of the Fed's Board of Governors since 2012. And today, he suggested again that he will generally continue the policies the Fed has pursued under Janet Yellen's leadership. Both Democrats and Republicans found things to like in Powell's testimony. Democrats appreciated his view that unemployment could go lower and that there are still Americans on the sidelines, particularly prime, working-age males, who aren't participating.

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JEROME POWELL: And that is the one measure I think that stands out now - is suggesting that there may be more slack, more people that can come back to work.

YDSTIE: Powell said the lack of strong wage gains also suggests that unemployment could go lower. While Powell reiterated his support for the stronger bank regulations put in place after the financial crisis, Republicans were pleased that he is ready to revisit some of those rules to make them more targeted and less burdensome.

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POWELL: We will continue to consider appropriate ways to ease regulatory burdens while preserving the core reforms.

YDSTIE: Core reforms such as requiring banks to undergo regular stress tests and have more capital as a cushion against losses. The nominee for the Fed's top job also said he believes the financial system is much more stable now than it was before the housing bust and financial crisis. But he said he is concerned about cybersecurity.

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POWELL: It's maybe the most important risk that our financial institutions, our economy, our government institutions face. We're very focused on providing the resources to deal with it.

YDSTIE: Both Republicans and Democrats tried to get Powell to weigh in on the tax bill that Republicans are pushing through Congress. Democrats asked whether he agrees with the Congressional Budget Office that the tax bill would add about $1.5 trillion to the national debt over the next 10 years.

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POWELL: Clearly, the debt needs to be on a sustainable path. We all know that. On the other hand, it's not for us to be taking part in the discussion that you and your other elected colleagues are having.

YDSTIE: It's virtually certain that Pao's nomination will be approved by the Senate. He's likely to be sworn in and take over when Yellen's term ends in early February. John Ydstie, NPR News, Washington.

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