Fed Would Blunt Impact From A Digital Dollar as Banks Push Back
By Allyson Versprille
May 26, 2022, 6:10 PM
The Federal Reserve is considering ways to blunt any impact on commercial bank deposits if the US government decides to issue a digital dollar, according to the central bank’s vice chair.
While some decline is unavoidable, the Fed is looking at ways to avoid a significant decrease in deposits, Lael Brainard said Thursday. Industry lobbying groups including the American Bankers Association and the Bank Policy Institute have asked the government to hold off on launching a central bank digital currency, or CBDC, on concerns that it’d sap money from the banking system and make credit less available to businesses and ...