Trump set to tap Jerome Powell as Fed chairman
WASHINGTON: President
Donald Trump has selected Federal Reserve board member Jerome Powell as the next chairman of the nation’s central bank, succeeding Janet Yellen, two senior administration officials said on Thursday.
Trump was scheduled to make the announcement later in the day at a White House ceremony, said the officials, who spoke on condition of anonymity to discuss the president’s decision before the formal announcement.
After a search that was more public than any before n the Fed’s more than a century of history, Trump’s choice of the 64-year-old Powell will likely be seen as a safe choice who could represent continuity at the Fed.
Trump had considered re-nominating Yellen, the first woman to lead the cen- tral bank, for a second fourterm term. Her term will end in February. But in the end, he opted for Powell, a Republican, over Yellen, a Democrat, explaining last week that doing so would allow him to put his own mark on the Fed.
If confirmed by the Senate, Powell would be the first Fed leader in nearly four decades to lack an advanced degree in economics. He has served on the Fed board since 2012 after a career as an investment manager through which he amassed personal wealth in the tens of millions.
Trump had indicated that his final decision had come down to Powell, Yellen and John Taylor, a Stanford University economist. Earlier, the president had also consid- ered Kevin Warsh, a former member of the Fed board, and Gary Cohn, his chief economic adviser.
Powell will likely be welcomed on Wall Street as someone who has supported the cautious stance toward interest rate hikes that Yellen has pursued in her nearly four years as chair and may be inclined to extend that approach if the economy performs as expected.
At the same time, no one is sure how closely Powell will hew to the Yellen model. He is, for example, thought to be more skeptical than Yellen of the tighter regulations that were enacted after the 2008 financial crisis.
And depending on how the economy fares, Powell might lean somewhat more aggressively toward interest rate hikes than Yellen did. How effectively he would lead the Fed’s response to an unexpected economic crisis is unknown as well.