US President Trump apparently wants to nominate the central bank director Powell as the new boss. The 64-year-old is to follow Fed chairman Yellen. According to a report, Powell has already been informed of the decision.
US President Donald Trump wants to make central bank director Jerome Powell a new head of the Federal Reserve, according to an insider. Trump will nominate the 64-year-old on Thursday as the successor to Fed chief Janet Yellen, said a person familiar with the situation on Wednesday.
With Powell, a currency guardian would move to the top of the world’s most influential central bank, which has been on the corporate floor for years and expects experts to continue the Yellen rate with cautious interest rate hikes. According to the Wall Street Journal, he has already been informed about Trump’s decision. The candidate nominated by the president still has to be confirmed by the senate. Yellen’s term expires in early February 2018.
Trump had announced on Wednesday a decision for Thursday afternoon (local time). Powell has been a favorite for the post for some time. The lawyer and former investment banker is the sole representative of Trump’s Republicans on the Fed’s governing body. He is considered a compromise candidate that Republicans and Democrats alike can accept. Yellen was praised after initial criticism from Trump again and again. But according to a recent report she is now out of the race.
While Powell argued for continuity in monetary policy, economics professor John Taylor, who was also considered a candidate recently, would rather stand for a radical break. Stanford University’s economist has developed a formula for determining the appropriate interest rate – the “Taylor Rule” named after him – and wants to set monetary policy in line. However, the Fed leadership had stormed against such proposals, fearing that the central bank’s room for maneuver would be too severely restricted.