Yahoo Finance's Brian Cheung discusses how Fed Chair Jerome Powell will likely face questions on inflation as he testifies at the confirmation hearing for his second term.

Video Transcript

BRIAN SOZZI: Now in prepared remarks ahead of his confirmation hearing, Fed chief Jerome Powell said the Fed wants to prevent inflation from becoming entrenched. Yahoo Finance Fed correspondent Brian Cheung is back with us. Brian, clearly, chair Powell is about to come out swinging on inflation, or at least hinting that he might.

BRIAN CHEUNG: Yeah, we're waiting for that Senate Banking Committee testimony to begin in just a few minutes. Now, of course, this is not just a regular testimony. This is his confirmation hearing after being announced for a second term as the Federal Reserve Chairman by President Joe Biden.

Now, of course, we already got his prepared remarks. And he really hit on the idea of inflation, and wants to emphasize to the committee that this is something he's going to take very seriously. He said, quote, we know that high inflation exacts a toll, particularly for those less able to meet the higher costs of essentials like food, housing, and transportation.

And just a few seconds ago, we did get some opening remarks sent to the press by email from the ranking member. That's the top Republican on this committee, Pat Toomey. He wants to emphasize that the Fed needs to pay even more attention beyond that to inflation. Quote, for the past 18 months, I cautioned that the Fed was fighting the last war, a mystery pathogen that led governments to collectively shut down the global economy when a new enemy is here-- inflation. So this could be something that the Republicans want to hit the Fed Chairman on pretty hard.

Now for what it's worth, even though this is a confirmation hearing, he needs to support-- or get the support of both the Senate Banking Committee, and then after that, the whole Senate at large. Really, expectation is that he should be able to sail the confirmation very easily. The Biden administration chose not to replace the Fed Chair with a new name. Obviously, Lael Brainard was tapped for vise chair. Her confirmation hearing will be on Thursday.

But Powell has gone through a number of confirmation hearings before, not just for his first term as Fed Chair, but as a Fed governor as well. And in all of those previous cases, he was confirmed on a bipartisan basis. So the expectation is for the same out of this as well.

JULIE HYMAN: So not much suspense, then, around the confirmation itself, but certainly some suspense over the tenor of the questioning him on inflation. Also, potentially about the ethics issues that have gone on as he has been Fed Chair. Loretta Mester giving an interview this morning, another Fed governor, and saying she doesn't believe the Fed has an ethics problem. I wonder if the members of Congress are going to see it that way.