WASHINGTON— Fed Vice Chairwoman Lael Brainard is being asked for answers on how the central bank views its powers to issue a digital dollar.
Rep. Patrick McHenry (R-NC), the senior Republican on the House Financial Services Committee – and potentially its next chairman, sent a letter along other committee Republicans asking Brainard to explain her view on the central bank’s authority. Specifically, they want to know exactly what can trigger a Fed decision on creating a U.S. central bank digital currency (CBDC), according to CoinDesk.
The letter is in follow up to several points made by Brainard during her testimony before the panel in May, which was her first after being sworn in as vice chairwoman of the Fed board. At that hearing, she said the Fed wouldn’t act on issuing a CBDC without “strong support” from the White House and Congress, adding that the agency had no intention of serving consumers directly, CoinDesk noted.
Clarification Sought
The letter calls for Brainard to clarify what she meant by support that would justify the Fed’s move – whether that could be in the form of non-binding communications, like letters or executive orders.
“Is it your view the Federal Reserve may not establish an intermediated CBDC model without direct authorization from Congress?” the letter asks.
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