Jerome Powell was born on February 4, 1953 in Washington, D.C. He does not have a PhD in economics – instead, he earned a Juris Doctor degree from Georgetown University Law Center in 1979. Under President George H. W. Bush, he worked as Undersecretary of the Treasury. He also has rich experience in the private sector – for example, in 1997-2005, he was a partner at the Carlyle Group, a New York-based private equity firm.
He is a current Federal Reserve Governor – he took office on May 25, 2012, to fill the unexpired term of Frederic Mishkin. In 2014, he was nominated for another term ending January 31, 2028.
On November 2, President Donald Trump nominated Powell to be the next Fed Chair. He took office on February 5, 2018, replacing Janet Yellen in that position.
Powell and Gold
How would Powell’s nomination impact the gold market? Well, probably not so much, as he has been always in line with Yellen and he never dissented at the Fed, so de facto his nomination would probably result in keeping the status quo. This is why he is sometimes called a Republican version of Yellen.
However, such a view is probably inaccurate. Powell may be actually a bit more hawkish than Yellen, as he was skeptical of the third round of quantitative easing started in 2012. Moreover, improved macroeconomic conditions and the more hawkish composition of the FOMC in 2018 could encourage (or even force) him to also be more hawkish. Additionally, his approach toward financial regulation would be softer.
Hence, Powell’s leadership might be worse than Yellen’s for the gold market – not necessarily because of Powell’s different nature, but due to personal shifts within the FOMC and distinct macroeconomic environment in which he would have to act.
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