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The Week Ahead: Updates on Federal Financial Policy

Fed RatesJerome Powell, Chairman of the Federal Reserve, will be delivering his semi-annual testimony to the House Financial Services Committee on Tuesday and Wednesday, to give an update on economic conditions and possible interest rate shifts. During Powell's last testimony, on July 10, 2019, the Fed Chair said that though the economy remained strong, "crosscurrents, such as trade tensions and concerns about global growth, have been weighing on economic activity and the outlook."

More recently, Powell addressed proposed changes to the Volcker Rule. The Federal Reserve has announced that it will be making changes to the Volcker Rule, and the Fed along with the Commodity Futures Trading Commission. Changes proposed include simplifying and clarifying the operation and compliance requirements of the rule, permitting banking entities to engage in additional fund-related activities, as well as improving and clarifying the treatment of foreign funds.

The Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Securities and Exchange Commission is currently seeking public comment on the changes proposed to the regulations implementing section 13 of the Bank Holding Company Act.

“As I have said before, the intent behind the Volcker rule is the right one—banks should not use deposits that are insured by taxpayers to make risky proprietary trades or investments in hedge funds and private equity funds,” said Powell. “We now have considerable supervisory experience putting that common sense prohibition into practice, and we have learned that a simpler, clearer approach to implementing the rule makes it easier for both banks and regulators to carry out the intent of the rule. We have already taken several steps in that direction and the proposal before us continues that work.”

Here's what else is happening in The Week Ahead:

  • New York Fed Household Debt (February 11)
  • Federal Budget (February 12)

About Author: Seth Welborn

Seth Welborn is a Harding University graduate with a degree in English and a minor in writing. He is a contributing writer for MReport. An East Texas Native, he has studied abroad in Athens, Greece and works part-time as a photographer.
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