GOP senators signal support for Fed nominee Shelton

WASHINGTON — Two senior Republicans on the Senate Banking Committee who previously raised concerns about one of President Trump’s picks to be a Federal Reserve Board governor signaled this week that they may be willing to support the nomination.

Sen. Pat Toomey of Pennsylvania said he will vote to confirm Judy Shelton to serve on the Fed board after he previously had wavered on whether he would support her nomination, citing her views on monetary policy expressed in past writings. And Sen. Richard Shelby, R-Ala., said he would be willing to vote to confirm Shelton if a majority of Republicans decide to support the nomination, according to Bloomberg News.

Bloomberg News

“She clarified to me that she will oppose using monetary policy for the purpose of devaluing the dollar,” Toomey said in a press release. “It would have been imprudent and contrary to statutory authorization for the Federal Reserve to go down this path. Given her assurances, I intend to support Dr. Shelton’s nomination.”

Shelton wrote a letter to Toomey after her confirmation hearing saying she does not believe the Fed has the authority to use monetary policy for devaluing the dollar.

She also assured Toomey that she does not think it would be “appropriate for the Federal Reserve to react directly to the foreign exchange behavior of other countries.”

And Shelton said she does not think it is the Fed’s responsibility to “directly target U.S. competitiveness on trade as an economic objective.”

While Shelby was not as firm in his support for Shelton, he said he would be willing to vote with other Republicans to confirm her, according to Bloomberg News.

“If the committee, the majority of the committee, I’m talking about Republicans, want to support her, I would do it too,” Shelby said. “She wouldn’t be my number one choice.”

While the senators’ comments on Shelton’s nomination are a positive sign for her confirmation to the Fed, one other committee Republican, Sen. John Kennedy, R-La., also signaled after the Senate hearing he was undecided on how he would vote on Shelton’s nomination.

In an interview with American Banker, Sen. Tom Cotton, R-Ark., would not comment on Shelton’s nomination, and Sen. Martha McSally, R-Ariz., said she was still evaluating it.

“We’re still looking at it,” McSally said.

Republicans have only a 13-12 majority on the Senate Banking Committee, so any single GOP defection on the committee could sink the nomination.