Powell’s Approach to Recovery, Inflation Will Test Union Loyalty
- President has pledged to address economic inequality
- Biden to decide this year to reappoint or replace Fed chair
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Jerome Powell enters the final year of his term as Federal Reserve chair enjoying the support of labor unions with influence in Joe Biden’s White House, an advantage as the administration prepares to decide later this year whether to reappoint the central bank chief.
But Powell’s union support -- built in part through explicit outreach that the Fed chair has championed -- is likely to be tested as the rebound in growth strengthens and the jobless rate falls. The Fed is expected to hit a crossroad within months: Keep pumping cash into the economy to make sure the recovery benefits minority communities, or signal a pull-back to avoid inflation.