Donald Trump on Thursday appointed Jerome Powell to chair the Federal Reserve, replacing Janet Yellen, whose term ends in February, signaling a desire for continuity in monetary policy.
Already a senior official at the Fed, Jerome Powell, 64, is a moderate Republican, lawyer and former banker. His four-year appointment is yet to be confirmed by the Senate.
“He’s strong, he’s determined, he’s smart,” Donald Trump said in announcing the nomination. He pointed out that Jerome Powell, a former banker, would bring “a unique business experience”.
“It will give our government a real-world perspective,” said Donald Trump, who also praised the work of outgoing President Janet Yellen.
This choice is one of the most important economic decisions of Donald Trump’s term, the Fed being the most powerful central bank in the world. Its monetary initiatives can boost or slow down the world’s largest economy by setting the cost of credit, affecting the dollar and hence all financial markets.
Jerome Powell, a lawyer and former multi-millionaire business banker is already a Fed governor since 2012, then named by Democratic President Barack Obama.
He is seen as a man of compromise and consensus. Throughout his career, Mr. Powell “has earned the respect of members of Congress beyond partisan lines,” added the Republican President.
Jerome Powell has always followed Janet Yellen in her monetary decisions and symbolizes a reassuring continuity for the markets, while allowing Donald Trump to mark the direction of the central bank by choosing a Republican.
Janet Yellen, 71, a Democrat named by Barack Obama in 2014, will have been the first woman ever to lead the monetary institution. At the end of her mandate in February, she can still return to the board of the central bank as governor until 2024, a possibility however rarely used by her predecessors.