Yellen defends Fed's independence following Brainard donation to Clinton

Federal Reserve chair Janet Yellen vigorously defended the U.S. central bank's ability to accomplish its dual-mandate without being influenced by political pressures, in the wake of reports that a Fed governor made a series of campaign contributions to a leading U.S. presidential candidate.

Yellen fielded questions on the Fed's independence within the federal government on Wednesday, days after a report surfaced last week that Fed governor Lael Brainard donated $750 to the campaign of Democratic frontrunner Hillary Clinton. Brainard, who served as Deputy National Economic Advisor under former President Bill Clinton in the mid-1990s, made the donations in three contributions from November through January, according to Federal Election Commission (FEC) records.

"We are a nonpartisan independent institution devoted to pursuing our congressionally mandated objectives, and I have never seen political views in any way influence the policy judgments that are made inside the Federal Reserve," Ms. Yellen said. "I want to say that emphatically."

Governors from the Federal Reserve are subject to the Hatch Act, a federal law passed in 1939, which prohibits high-level officials from engaging in partisan political activity. The law, which was named for Sen. Carl Hatch (D, New Mexico), was most recently amended in 2012.

"I would say, within that, it’s up to each individual to decide what is appropriate in their point of view," Yellen added. "The Federal Reserve is not a partisan political organization."
Brainard has close family ties with both Bill and Hillary Clinton. For a five-year period beginning in 2009, Brainard's husband, Kurt Campbell, worked in the State Department as the Assistant Secretary of State for East Asian and Pacific Affairs, while advancing a comprehensive U.S. strategy that took him to every corner of the Asia-Pacific region. In 2013, Hillary Clinton awarded him with the Secretary of State's Distinguished Service Award – the nation's highest diplomatic award.

News source: investing.com