Warsh names Fed review panels with finance, business and academic figures

Federal Reserve Chairman Kevin Warsh on Thursday named the members of five task forces created to review how the central bank operates, drawing on Wall Street figures, business executives, academics and former Fed officials. The review could shape changes at the institution this year, although the Fed’s release did not specify when the groups will finish their work.

Warsh first said last month that he planned to establish the panels. According to the Fed, their areas of focus include communications, data, the central bank’s balance sheet, productivity and jobs, and the framework policymakers use to assess inflation.

The roster includes venture capitalist Marc Andreessen, former Bank of England Governor Mervin King and Greg Mankiw, who previously chaired the White House Council of Economic Advisers. Doug McMillon, identified by the Fed as the former chief executive of Walmart, is among the business executives taking part.

The task forces are intended to examine the Fed’s internal and policy-facing functions at a time when monetary officials are weighing how they communicate decisions, interpret economic data and manage the consequences of past balance-sheet actions. The balance sheet is a central policy channel because the Fed’s holdings of securities can affect financial conditions alongside interest-rate decisions.

The communications review is likely to receive close attention from investors because Fed statements, projections and press conferences are used to infer the likely path of interest rates. The inflation framework is also central to market pricing, since it influences how policymakers define progress toward their objectives and how they respond when price pressures and labor-market conditions move in different directions.

Warsh said in the Fed announcement that he was “honored that the best minds from a range of disciplines have agreed to work with us to sharpen our performance as an institution.” He added: “The goal is straightforward: to ensure the Fed is best positioned to achieve our objectives in this consequential time.”

The Fed did not provide a schedule for the task forces’ conclusions or state what form any recommendations might take. Warsh has indicated that he expects changes to come this year, according to the announcement.

This story draws on original reporting from CNBC.