Powell’s Reappointment: Members of Congress May Stand Against it

Everyone in the financial industry realizes that the main reason investors continually buy US stocks is that they believe that the economic and infrastructure stimulus package implemented by the Biden administration can fuel the country’s economic recovery. Driven by this thinking, investors are constantly buying financial products that benefit from these policies, resulting in three major US stock indices repeatedly breaking all-time highs. It should be noted that the purchase of related stocks is not attributed to their confidence in Powell though, he tried to send moderate messages during the first half of the year to keep monetary policies relaxed, and the financial market stabilized. So, it is the stimulus package stipulated by the Biden government that is propelling US stocks to all-time highs again and again, as only the stock markets of Germany, Australia, and Canada experienced the same situation when the central banks around the world have complacent attitudes as the Federal Reserve (Fed).

Powell attended the Congressional hearing last week, where he was aggressively criticized by the Senate and House of Representatives despite the swift growth of the US economy lately. Among them, Pat Toomey, the Republican Party senator, challenged the Fed’s competence to predict the duration of inflation after admitting its incompetence in estimating the potential severity of inflation. Most members indicated that they were concerned about the policies adopted by the Fed, as the escalation in inflation is more severe than expected by the general public and the Fed.