Federal Reserve Governor Michelle Bowman participated in a “Fed Listens” event at the Federal Reserve headquarters located in Washington, DC, on October 4, 2019.
Eric Baradat | AFP | Getty Images
On Monday, President Donald Trump announced his decision to appoint Federal Reserve Governor Michelle Bowman to assume the central bank’s leading supervisory position.
This announcement follows Michael Barr’s resignation from his position as vice chair for supervision, although he will continue to serve as a Fed governor.
Bowman’s promotion positions her as a more banking-friendly figure in the key oversight role at the Fed. A former bank executive and state regulator in Kansas, she joined the central bank during Trump’s first term.
“I am happy to share that Michelle ‘Miki’ Bowman will be the new Vice Chair of Supervision at the Federal Reserve,” Trump expressed in a post on Truth Social. “Miki has served honorably on the Fed’s Board of Governors since 2018, demonstrating considerable expertise in managing Inflation, Regulation, and Banking. Our Economy has faced mismanagement over the last four years, and a change is overdue. Miki has the required ‘know-how’ to address these issues. I am confident that we will reach unprecedented Economic success in our Nation’s History.”
Bowman will assume a position that is not favored by Fed Chair Jerome Powell. During Congressional testimony in February, Powell noted his belief that the vice chair for supervision role has introduced “volatility” to the central bank. This position was established as part of regulatory reforms following the 2008 financial crisis.
Since Trump’s election, bank stocks have outperformed the broader market, likely due to expectations of reduced regulation within the sector. Since November 5, the Financial Select Sector SPDR Fund (XLF) has increased by 5.1%, whereas the S&P 500 has seen a nearly 2% decrease.
As a member of the Fed, Bowman is also involved with the Federal Open Market Committee, responsible for determining the central bank’s benchmark interest rate. The committee is scheduled to convene this Tuesday and Wednesday, though it is anticipated that rates will remain unchanged during this meeting.
