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Senate Banking Committee Holds Semiannual Monetary Policy Hearing, GSE Reform Discussed

19 Jul 2018 1:44 PM | Steve Wallace (Administrator)

On July 17, the Senate Committee on Banking, Housing, and Urban Affairs held a hearing entitled “The Semiannual Monetary Policy Report to Congress”. Chairman of the Federal Reserve Board of Governors Jerome H. Powell delivered testimony to the full committee.

While the hearing itself was largely focused on broader issues of monetary policy, Senator Jon Tester (D-MT) did bring up during the Q&A portion the issue of the future of Freddie Mac and Fannie Mae. Senator Tester noted his concerns about the potential economic impact of requests such as Fannie’s recent one to draw $3.7 billion from the US Treasury. Chairman Powell declined to offer up specific plans, but did acknowledge that GSE Reform was something that should be accomplished sooner rather than later.

The comments during the hearing on GSE Reform are unsurprising, as both the Trump Administration and Members of Congress from both Caucuses have brought up the issue since President Trump took office. To that end, it is worth mentioning that President Trump’s recently released Federal Restructuring Proposal does call for GSE Reform, but no formal legislative language has resulted from it. It is unlikely, at this rate, that Congress will take up the issue of GSE Reform in the immediate future, as both Chambers still need to pass the FY 2019 Spending Bills, and the Senate still has a long list of nominees to vote on (including the nominee for HUD Assistant Secretary for Public and Indian Housing). However, GSE reform is still very much on the minds of lawmakers, and IRHP members should keep an eye on its progression.

Watch the hearing

HousingWire has a good summary of the day's events

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