Powell's Congressional hearing was heavily criticized senator Warren called him a dangerous person and should not be re-elected as fed chairman

Financial Associated Press (Shanghai editor Xia Junxiong) news, local time on Tuesday, Federal Reserve Chairman Powell attended the Senate Banking Committee hearing, Powell still adhere to the consistent dovish stance, talked about the central bank's digital currency, but also responded to the recent huge controversy caused by the Fed senior officials to speculate in stocks.

Powell said that while the economy has almost passed the test of shrinking its bond-buying program, it is still a long way from achieving the standard of maximum employment, which is a key indicator of the Fed's interest rate hike.

During the inquiry session, Republican Sen. Patrick Toomey said he was curious about the potential benefits of the central bank's digital currency, but was also concerned about privacy and other possible issues.

Powell responded that the central bank digital currency would be the most ideal situation if it could be supported by broad consensus and congressional legislation.

Boston Fed President Rosengren and Dallas Fed President Kaplan announced their resignations on Monday after media reports that Kaplan and Rosengren were involved in a large number of stock transactions in 2020. As soon as the news was exposed, it caused an uproar, and the two were eventually forced to resign under external pressure.

In response, Powell said the Fed is reviewing regional chairmen's deals to ensure they comply with the central bank's regulations. Powell added that while the deals appear to be in line with existing rules, they will also be reviewed and improved.

Warren criticizes Powell as a dangerous man

Powell's congressional testimony was released monday, and his remarks were not unexpected, but Democratic Senator Elizabeth Warren opened fire on Powell mercilessly at the meeting, which became the biggest highlight of the hearing.

Powell's term ends next February, and U.S. President Joe Biden has yet to decide whether to appoint him to remain Fed chairman. While Wall Street is widely expected to re-nominate Powell, some liberal senators oppose Powell's re-election, and Warren is one of them.

Warren said Tuesday she would vote against Powell's re-election as Fed chairman and called him a dangerous man leading the Fed.

"Your record worries me so much that you've made our banking system insecure time and time again, and it's dangerous to have you chairman of the Fed, which is why I object to your nomination," Warren said. It is worth mentioning that although Warren's rhetoric is fierce, Powell did not respond to her criticism.

Warren noted that deregulation could trigger another catastrophe, as the U.S. experienced during the 2008 financial crisis. The banking sector needs Fed assistance during the pandemic, but deregulation has also exacerbated the dangers facing the financial system.

Warren said Powell has been lucky so far because banks are currently able to avoid big problems, but the 2008 crash showed that disasters can occur when luck runs out.

Warren stressed that the seeds of the 2008 financial crisis were planted years ago by major regulators such as the Federal Reserve, which refused to restrain the big banks, and that she came to Washington after the financial crisis to ensure that something like that doesn't happen again.