June 3, 2023

WASHINGTON — President Biden said Friday he would nominate Adriana Kugler for a seat on the Federal Reserve Board and elevate Philip Jefferson, a current governor, to vice chair of the central bank.

If confirmed by the Senate, the Fed would get its first Latina board member and its second Black Vice Chair, a move that could both make the Fed more diverse and expand its leadership team at a challenging economic time.

Mr. Biden chose Ms. Kugler, an economist with a background in labor economics who is of Colombian descent and is the US Executive Director of the World Bank, to fill the Fed’s only remaining open governorship position on its seven-member board. In a corresponding move, he elevated Mr. Jefferson, an economist who was overwhelmingly confirmed to the board when Mr. Biden nominated him for an open governor position, to Vice Chairman of the Fed.

The New York Times previously reported on the expected nominations.

Lael Brainard, who became head of Biden’s National Economic Council from the White House earlier this year, served as vice chairman of the Fed until February.

Because the vice chair of the Fed is drawn from among the seven governors, Mrs. Brainard’s resignation left both a governor’s seat open and the role of vice chair vacant. Ms. Kugler will fill the vacant seat on the board, while Mr. Jefferson, who is already a Fed governor, will be elevated to the leadership position.

The Biden administration had to balance a complicated set of priorities as it filled the gaps at the Fed, the most powerful central bank in the world. The government is under pressure, especially from New Jersey Democrat Senator Bob Menendez, to appoint a Latino or Latina to the Fed Board. And the Fed itself is in an unusually challenging time: it is trying to lower rapid inflation with the most aggressive policy campaign since the 1980s, one that could cost the labor market significantly.

Mr. Biden also announced that he will nominate Lisa Cook, a sitting Fed governor whose term expires early next year, for another full 14-year term as a member of the board of directors.

“These nominees understand that this job is not a partisan job, but plays a critical role in pursuing maximum employment, maintaining price stability and overseeing many of our nation’s financial institutions,” Biden said in a statement. announced the choices.

In the central bank’s more than 109-year history, a Latino has never sat on the Fed’s board, so Ms. Kugler’s nomination would be a first if it ended in confirmation. It would also add an official with significant experience in labor economics: Ms. Kugler, who used to be an economist and administrator at Georgetown University, was chief economist of the Labor Department during the Obama administration from 2011 to 2013.

She has worked in the economics departments of the University of Houston and Pompeu Fabra University in Barcelona, ​​and holds a PhD from the University of California, Berkeley.

Mr Menendez praised the decision in a statement Friday and made it clear that he will support the nominees.

“I will make it my personal mission to ensure fast confirmations for Jefferson, Cook and Kugler,” he said.

Mr. Jefferson, who took office at the Fed last May, is an economist who most recently served as an administrator at Davidson College and holds a doctorate in economics from the University of Virginia. During his tenure at the Fed, he has developed a reputation as a curious listener with an interest in staff economic research.

Mr. Jefferson was born in Washington DC, in a neighborhood called Kingman Park. During his confirmation hearing to become Fed governor, he recalled that in his childhood it was a place where the line between a future of success or struggle was thin.

If confirmed, he would be the second black person to reach such a senior position at the Fed after Roger W. Ferguson Jr., an economist and businessman.