"With my statutory term as Governor due to expire on January 31, 2022, I am writing to inform you that it is my intention to resign from the Board on January 14," Clarida said in a letter to U.S. President Joe Biden.
Clarida, a member and the vice chair of the Fed board since September 2018, said that he was proud to have served with colleagues at the Fed to "put in place historic policy measures" that steered the U.S. economy away from depression and supported a robust recovery from the COVID-19 pandemic.
"There is still road left to walk and damage to be repaired... I am confident that once the process of reopening is complete, a welcome return to maximum employment and price stability awaits," he said.
"Rich's contributions to our monetary policy deliberations, and his leadership of the Fed's first-ever public review of our monetary policy framework, will leave a lasting impact in the field of central banking," Fed Chair Jerome Powell said in a statement.
Clarida's resignation follows questions raised over financial transactions he conducted at the start of the pandemic. The New York Times recently reported that Clarida failed to initially disclose the extent of a financial transaction he made in early 2020 as the Fed was preparing to rescue markets amid the unfolding pandemic.
"This revelation is just the latest evidence of a deep-rooted ethics failure at the Fed and the urgent need for a comprehensive information release about officials' trading activity," U.S. Democratic senator Elizabeth Warren wrote Monday in a letter to Powell.
"I have already requested an SEC (Securities and Exchange Commission) investigation into Fed officials' trading activity to determine if any trades violated insider trading rules," Warren wrote, calling on Powell to immediately release information related to Fed officials' trades and changes to the Fed's ethics policy.
Prior to his appointment to the Fed, Clarida served as the C. Lowell Harriss Professor of Economics and International Affairs at Columbia University.
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