I sometimes ask my students to tell me who is the most powerful person in the world. After giving them time to discuss the options, they usually put forward responses such as Joe Biden or Xi Jinping. But then I have them consider the possibility that it is not a head of state, that instead it might be a technocratic appointee: the head of the U.S. Federal Reserve System, the Federal Reserve Board chair.
To understand why, consider that financial analysts working inside and outside the United States were highly anticipating an address last Friday by current Federal Reserve Chair Jerome Powell. In those remarks, given at the Fed’s annual symposium in Jackson Hole, Wyoming, Powell said “The time has come for policy to adjust.”
By “adjust,” Powell was referring to the Fed’s Federal Open Market Committee lowering its target interest rate. The Federal Reserve currently aims to keep its target interest rate, the Federal Funds Rate, at a 23-year high of 5.25 percent to 5.5 percent.