Here’s a look at the candidates President Donald Trump is considering over the next few weeks to nominate as chairman of the Federal Reserve and where they stand on monetary policy.
Trump has met with Fed Chair Janet Yellen, National Economic Council Director Gary Cohn, Fed Board Governor Jerome Powell and former Governor Kevin Warsh as he considers his choice to head the U.S. central bank, three people familiar with the discussions said last week. Stanford University economist John Taylor is also on the list of recommendations put together by Trump’s advisers. There’s no clear front-runner and outlier candidates haven’t been ruled out.
Trump has said he expects to make a decision on the Fed-chair search this month. That’ll kick off a months-long process of Senate confirmation before Yellen’s current term expires in February.
Janet Yellen
Hawk or Dove? Yellen, 71, has had a track record of keeping rates low over her four-year term. She has consistently supported gradually tightening policy and gradually unwinding the balance sheet. Yellen has been a “super-dove,” though “sprouting a few hawk feathers,” Amherst Pierpont Securities Chief Economist Stephen Stanley said.
Last month, Yellen said it’s uncertain exactly why inflation has been running below the Fed’s 2 percent target -- which it has mostly missed for the past five years. Weak inflation “strengthens the case for a gradual pace of adjustments” in rates.
Regulatory Views: Yellen has defended stricter banking rules introduced after the 2007-2009 financial crisis. “Any adjustments to the regulatory framework should be modest,” she said in August.
Pros: Trump told the Wall Street Journal in July that he favors low rates, adding: Yellen has “historically been a low-interest-rate person.”
Cons: Yellen is a Democrat appointed by Barack Obama who’s led the regulatory policies the Trump administration is seeking to change. She’s an academic, while the administration has preferred installing business people into top positions.
Gary Cohn