Because the Fed’s vice chair comes from among its seven governors, Ms. Brainard’s resignation left both a governor seat open and the vice chair role vacant. Ms. Kugler will take the open spot on the board, while Mr. Jefferson, who is already a Fed governor, will be elevated to the leadership position.
The Biden administration needed to balance a complicated set of priorities as it filled those open spots at the Fed, the world’s most powerful central bank. The administration is under pressure, especially from Senator Bob Menendez, Democrat of New Jersey, to appoint a Latino or Latina to the Fed Board. And the Fed itself is at an unusually challenging juncture: It is trying to wrestle rapid inflation lower with the most aggressive policy campaign since the 1980s, one that could come at a significant cost the job market.
Mr. Biden also announced that he would nominate Lisa Cook, a sitting Fed governor whose term will expire early next year, to another full 14-year term as a member of the board.
“These nominees understand that this job is not a partisan one, but one that plays a critical role in pursuing maximum employment, maintaining price stability and supervising many of our nation’s financial institutions,” Mr. Biden said in statement announcing the picks.
A Latino person has never served on the Fed board in the central bank’s more than 109-year history, so Ms. Kugler’s nomination would be a first if it ended in confirmation. It would also add an official with considerable experience in labor economics: Ms. Kugler, who was formerly an economist and administrator at Georgetown University, served as chief economist of the Labor Department during the Obama administration from 2011 to 2013.