Jerome H Powell will be the next chairperson of the United States Federal Reserve, and will succeed Janet Yellen when her term ends in February, Reuters reported. Powell has President Donald Trump’s backing, and the Senate confirmed his appointment on Tuesday with a 84-13 vote.
Powell, currently a governor on the board of the United States central bank, is known to favour low interest rates. He will have a four-year term. The 64-year-old lawyer has served on the Fed’s board since 2012, and has supported Yellen in her gradual interest rate increases. The Federal Reserve had to lower interest rates to near-zero levels to boost the economy after the global financial crisis in 2008.
In November 2017, President Trump nominated Powell, known as a “soft-spoken centrist”, as the next head of the US Federal Reserve. Trump’s decision not to reappoint Janet Yellen marked a break with the norm of presidents reappointing competent Fed chairs they inherited from their predecessor.
Soon after, Yellen said she would resign as a member of its Board of Governors once her successor is sworn in. The 71-year-old was appointed to the board by former President Barack Obama. She was the first woman to head the central bank.
A safe pick
Powell is seen as a safe pick as he is expected to continue the monetary policy followed by Yellen. He has supported the cautious approach to interest rate hikes that Yellen pursued during her term. The former private-equity executive however favours lax bank regulations unlike Yellen, and is in sync with the generally pro-business, bank-friendly outlook of the White House.
Powell, a Republican, has earned a reputation as a non-ideological and pragmatic policymaker. But Trump had said in an interview in October 2017 that he wanted to make his own mark on the central bank. “You like to make your own mark, which is maybe one of the things she [Yellen] has got a little bit against her, but I think she is terrific.”
Trump also considered Stanford University economist John Taylor, former Fed Governor Kevin Warsh, and White House economic adviser Gary Cohn. Financial magazine Barron’s Asia had earlier said that former Reserve Bank of India Governor Raghuram Rajan would be the ideal choice to head the US central bank.