Federal Reserve Governor Michelle Bowman expressed skepticism about the benefits of central bank digital currencies (CBDCs) during a roundtable discussion in Washington, D.C. She questioned whether a U.S. CBDC could solve financial problems more effectively or efficiently than existing solutions. Governor Bowman highlighted the importance of responsible innovation in money and payments, emphasizing the need to address frictions within the payment system and promote financial inclusion. However, she stated that she has yet to see a compelling argument in favor of a U.S. CBDC. She also noted that the U.S. payment system is evolving with innovations like FedNow, the Federal Reserve’s new interbank system for instant payments. Governor Bowman cautioned that introducing a CBDC could pose significant risks and tradeoffs for the financial system, including concerns about consumer privacy. She argued that the current intermediated banking model, in which commercial banks issue credit and manage reserves through the Federal Reserve System, is a more suitable model for future financial innovation.

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Information	Details
Geography	North America
Countries	🇺🇸
Sentiment	neutral
Relevance Score	1
People	Robert F. Kennedy Jr., Ted Cruz, Ron DeSantis, Tom Emmer
Companies	Federal Reserve System, FedNow
Currencies	None
Securities	None