Ben Bernanke has done it. The financial markets now move when the chairman of the US Federal Reserve speaks, a sign of growing credibility.
Bernanke had stepped into the oversize shoes of Alan Greenspan, a man who quite enjoyed playing the role of the wise oracle. There was a time when the markets danced to his tune.
His successor was seen as a dry academic—but not any longer. Bernanke’s testimony to the US Congress of 21 July had enough hints of optimism to send stocks up across the globe and for the dollar to stabilize. Six months ago, it was his mention of green shoots that helped roll back panic in the financial markets.
A global poll of investors released by Bloomberg on Thursday shows that 74% of the respondents think he is doing a good job, at least 20 percentage points more than the approval ratings of other central bankers.
The markets are impressed. The question now is whether US politicians will be equally happy with Bernanke when he is up for reappointment when his term ends in January.