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Business News/ News / World/  Barack Obama nominates Janet Yellen to lead Federal Reserve
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Barack Obama nominates Janet Yellen to lead Federal Reserve

Yellen’s nomination is subject to Senate confirmation, Democratic leaders say she’ll easily win majority support

Janet Yellen, 67, will be the first woman ever to lead the Fed. Photo: Reuters (Reuters)Premium
Janet Yellen, 67, will be the first woman ever to lead the Fed. Photo: Reuters
(Reuters)

Washington: US President Barack Obama said Janet Yellen, his nominee to become the first woman to head the Federal Reserve, will bring to the job a deep knowledge of markets and the economy as well as an understanding of the impact of policies on people.

“Yellen is committed to both sides of the Fed’s dual mandate to bolster job growth while keeping inflation in check," Obama said at the White House, flanked by Yellen and the current Fed chairman, Ben S. Bernanke, whose term expires on 31 January.

“America’s workers and their families will have a champion in Janet Yellen," Obama said.

Yellen, now the Fed’s vice-chairman, said in her remarks that more needs to be done to strengthen the recovery and that the Fed can promote employment growth while holding down inflation.

“The mandate of the Federal Reserve is to serve all of the American people," Yellen said.

The president lauded Bernanke’s leadership at the Fed, calling him a voice of reason and a steady hand who displayed tremendous courage and creativity in helping the US recover from the worst recession since the Great Depression.

“I’m personally very grateful to you," Obama said to Bernanke.

The nomination of Yellen, 67, vice-chairman of the Fed since 2010, is subject to Senate confirmation and the chamber’s Democratic leaders predicted she’ll easily win majority support.

Bernanke’s term

Bernanke, the Fed’s chairman since 2006, has committed to staying through the end of his term even if Yellen is confirmed before then, according to a person familiar with his plans, who asked for anonymity to discuss private talks.

The president’s decision to nominate Yellen followed a polarizing and unprecedented public contest for a nomination that Obama described in August as one of the most important decisions of his presidency. Yellen was the favourite in surveys of economists and had the backing of 20 members of the Senate Democratic caucus who signed a 26 July letter to Obama.

Yellen became the leading candidate after former treasury secretary and White House economic adviser Lawrence Summers withdrew from consideration last month amid opposition from Senate Democrats.

A member of the Fed’s board of governors and chairman of the White House Council of Economic Advisers during the Clinton administration, Yellen later was president of the Federal Reserve Bank of San Francisco before Obama nominated her to the No. 2 job at the Fed in 2010.

Senate process

Her nomination as Fed vice-chairman passed the Senate Banking Committee with a vote of 17-6, providing a preview of what her confirmation process could look like. There are 12 Democrats and 10 Republicans on the Banking Committee.

As a top deputy to Bernanke, Yellen supported the central bank’s unprecedented bond buying programs and was a driving force behind a new strategy adopted in 2012 to commit the central bank to goals on inflation and unemployment.

Optimism that Yellen won’t rush to withdraw stimulus help push US stocks higher after two days of declines. The Standard and Poor’s 500 Index rose 0.4% to 1,661.28 at 2.31pm in New York. The Dow Jones Industrial Average added 64.90 points, or 0.4%, to 14,841.43, reversing an earlier loss of 0.4%. Bloomberg

Cheyenne Hopkins and Joshua Zumbrun in Washington contributed to this story.

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Published: 10 Oct 2013, 12:58 AM IST
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