The Federal Reserve Bank of Cleveland announced on Wednesday that Beth Hammack, a former executive at investment bank Goldman Sachs, will become its next president, effective Aug. 21.
Hammack, 52, worked at Goldman Sachs from 1993 until his retirement earlier this year.
She most recently served as co-head of global finance and has also held global financial director and senior trading roles. Hammack was appointed partner in 2010.
Hammack’s appointment comes at a critical time for the Fed, with Chairman Jerome Powell stressing that he will keep interest rates at a 23-year high of about 5.3% to combat inflation that has plummeted to 2.7% from a peak, according to the Fed’s preferred measure.
However, inflation remains above the Fed’s 2% target.
The Fed wants to keep borrowing costs high to tame inflation while trying to avoid an economic slowdown or recession that can result from too-high interest rates that make mortgages, auto loans, credit card debt and business borrowing more expensive.
Hammack will succeed Loretta Mester, who is retiring as Cleveland Fed president on June 30 after 10 years in the position. Fed presidents are typically required to retire when they reach age 65.
Mester has long served as a “hawk” on the Fed’s interest rate-setting committee, generally favoring higher interest rates to fight inflation, while “doves” typically support lower rates to boost the economy and jobs.
Mester supported the big rate hikes implemented by Chairman Jerome Powell in 2022 and last year to combat inflation, but said she was open to considering a possible rate cut this year and believes inflation is likely to continue to fall toward the Fed’s 2% target.
Mester has been a voting member of the Fed’s interest rate-setting committee this year and will have a vote at its next meeting on June 11-12.
Hammack will then vote at the Fed’s committee meetings in September, November and December.
All 12 regional Fed presidents attend the eight meetings a year where the central bank sets interest rate policy, but only five have a vote on decisions.
The New York Fed has a permanent vote, while the other four banks vote on a rotating basis.
