Sign up for our daily briefing

Make your busy days simpler with the Axios AM and PM newsletters. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to the Axios Closer newsletter for insights into the day’s business news and trends and why they matter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios Pro Rata

Dive into the world of dealmakers across VC, PE and M&A with Axios Pro Rata. Delivered daily to your inbox by Dan Primack and Kia Kokalitcheva.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with the Axios Sports newsletter. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with the Axios Des Moines newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with the Axios Tampa Bay newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Austin news?

Get a daily digest of the most important stories affecting your hometown with the Axios Austin newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Atlanta news?

Get a daily digest of the most important stories affecting your hometown with the Axios Atlanta newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Philadelphia news?

Get a daily digest of the most important stories affecting your hometown with the Axios Philadelphia newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Chicago news?

Get a daily digest of the most important stories affecting your hometown with the Axios Chicago newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top DC news?

Get a daily digest of the most important stories affecting your hometown with the Axios DC newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Sarah Grillo/Axios

Federal Reserve chairman Jerome Powell is offering Democrats fresh pledges to make climate change a priority, but there's little sign he believes the central bank should act to thwart Wall Street finance for polluting industries.

Driving the news: Powell told the Senate Banking Committee Tuesday that the Fed would proceed with analyzing banks' readiness to grapple with global warming and the ways climate change can threaten financial stability.

  • "Our role on climate changes is a limited one, but it's an important one. And it is to ensure that the banking institutions that we regulate understand their risks and can manage them," said Powell.

Yes, but: There's no sign that Powell, who President Biden has nominated for a second term, sees a direct role for the central bank in steering capital away from oil, gas and coal.

  • Some green groups want specific interventions to create more hurdles for fossil finance. The Sierra Club and Evergreen Action want "portfolio limits" on the level of polluting assets banks can hold. They also say the Fed should increase the capital banks must hold for their fossil portfolios.
  • Powell wasn't asked directly about these ideas yesterday. But in an exchange with Sen. Kevin Cramer (R-N.D.), Powell said, "The broader answer to climate change has to come from legislators and in the private sector."

What's next: Powell confirmed the Fed plans to subject big banks to "climate stress scenarios," which Powell said will be "a key tool going forward."

  • "Climate stress scenarios at this stage are really about ensuring that the large financial institutions understand all of the risks that they're taking," Powell said.
  • He said this includes "risks that may be inherent in their business model regarding climate change over time."
  • That's a reference to so-called transition risk, such as emissions policies that jeopardize fossil fuel projects and companies.

The big picture: Powell, who is likely to be confirmed, has been increasing the Fed's focus on analyzing climate-related financial risks. But he faces dueling political pressures. Republicans see mission creep at the central bank, while the left wants more aggressive steps.

  • For instance, Democrats Sen. Ed Markey and Rep. Mondaire Jones — backed by several green groups — have introduced legislation that would require the Fed to mandate new restrictions on fossil finance.

What we're watching: More policy hints could arrive tomorrow when Lael Brainard — a Fed board member that Biden has nominated for vice chair — appears before the banking panel that vets Fed nominees.

  • Brainard has been outspoken on climate. And so has Sarah Bloom Raskin, who Biden may nominate to be the Fed's powerful vice chair of supervision.
  • Raskin, currently a law professor at Duke University, wrote recently that financial regulators "need to ask themselves how their existing instruments can be used" to spur the rapid transition from high-emissions investments.

Go deeper: Bank regulators push Wall Street on climate risk

Go deeper

What Biden's Fed nominations mean for policy

Sarah Bloom Raskin at a 2013 hearing. Photo: Andrew Harrer/Getty Images

Now that President Biden's long-awaited nominations for vacant seats on the Federal Reserve Board of Governors have dropped, the big question is how Sarah Bloom Raskin, Lisa Cook, and Philip Jefferson, if confirmed, might shift policy.

  • The answer: Don't expect any big changes to the central bank's policy direction overnight — but do expect it to prioritize a healthy labor market more in the years ahead.

Why it matters: The Fed's actions shape the economy in ways that outlast the presidents who appoint them — and the Biden-appointed Fed looks to be a more explicitly pro-worker central bank than we've seen in modern times.

The big picture: With inflation running hot, the Fed is in the midst of a pivot to more hawkish monetary policy — possibly including raising interest rates in March.

  • Raskin, Cook, and Jefferson are unlikely to stand in the way of that pivot, and not just because the slow-moving Senate confirmation process means it will likely be well underway before they are confirmed for their new jobs.
  • The Fed is a consensus-driven institution, and the consensus has swung decisively in a hawkish direction in the last three months. Even normally-dovish officials like San Francisco Fed President Mary Daly and Chicago Fed president Charles Evans on board with the policy shift.

But over time, the new additions to the Board of Governors — who have a permanent vote on monetary policy, unlike regional Fed presidents who rotate — have emphasized the importance of running a hot labor market in order to achieve gains for workers and greater racial equality.

  • That implies the three new governors would resist continuing to push interest rates higher once inflation moderates.

What they're saying: "Inflation is so high and political pressures on the Fed are so strong (including from Democrats), that we doubt they will push hard against the will of the committee," wrote Roberto Perli and Benson Durham of Cornerstone Macro, in a client note.

  • But, they add, "Because all of them have expressed views in favor of broader expansion of the labor market, … we can expect them to resist substantial tightening in the future."

Regulatory policy is a different matter. If confirmed as vice chair for supervision — and Republican Senators will try to stop that from happening — Raskin would have more explicit power over a wide range of regulatory policy, and look to rein in the deregulatory impulses of her predecessor, Trump appointee Randal Quarles.

The bottom line: As the Biden Fed takes shape, it will include more voices focused on workers than in modern memory. But the course of policy depends on whether inflation trends allow them to act on those instincts.

The most startling facts in 2021 climate report

An unsettling part of the human condition today is that the year you were born will most likely be the coolest year of your life, globally speaking.

By the numbers: Newly released climate data from NOAA, NASA and Berkeley Earth show that the planet has had an unbroken streak of 45 years of warmer than average temperatures.

Updated Jan 15, 2022 - Energy & Environment

Earth's climate went off the rails in 2021, reports show

Temperature departures from average in degrees Celsius during 2021. (Berkeley Earth).

Global warming became local to a new and devastating extent in 2021, with the year ranking as the sixth-warmest on record, according to new, independent data from NASA, NOAA and Berkeley Earth.

Why it matters: Each year's data adds to the relentless long-term trend, which shows rapid warming due overwhelmingly to human-caused greenhouse gas emissions during the past several decades in particular.