U.S. President Donald Trump nominates Jerome Powell for the Federal Reserve chair on Nov. 2 2017 in Washington. , The Canadian Press
24 January, 2018, 11:06
Shortly after the final tally was called, Democratic Sen.
During a Senate hearing on his nomination in November, Powell defended plans to lighten regulation of the financial sector, and said he would "respond decisively" to any future crisis.
Powell, who was tapped by then-President Barack Obama to serve at the Fed, emerged as President Donald Trump's choice to lead it from a slate of possible nominees that included both Yellen and others who might have pursued a sharp policy shift.
The Fed has been gradually raising short-term interest rates since late 2015 and past year started shrinking its portfolio of assets purchased to bolster the economy during and after the financial crisis. Now that growth has picked up, "it's time for us to be normalizing interest rates, " he added. That could place Mr. Powell at odds with the White House, which would welcome a stronger expansion.
Powell takes over with monetary policy on a seemingly steady course toward gradually higher interest rates and a gradually smaller balance sheet, but with brewing debate within the central bank about whether it needs to rethink its approach to inflation, and how a recent massive tax overhaul may effect the economy. He will be the first Fed chairman in three decades who doesn't have a Ph.D.in economics.
Powell expressed his thoughts on the normalization of Monetary Policy during his speech in June 2017 for the Economic Club of NY. He also served as a top Treasury Department official responsible for domestic finance in the George H.W. Bush administration.
In addition to being a Democrat and the first female chief of the U.S. central bank, Yellen was also a defender of the regulations enacted following the financial crisis - putting her at odds with the current White House's deregulation agenda. The president has also nominated Marvin Goodfriend, a conservative economist, for another vacancy on the board.