On his last day as Fed vice chair, Stanley Fischer’s sent some advice to President Donald Trump: Stay the course.
In an interview at the globe Bank/International Monetary Fund conference Friday, Fischer pushed the president to reappoint Janet Yellen as Fed chair. Though normally reluctant to wade into political waters, he made his preference known.
“He should appoint Janet Yellen,” Fischer told CNBC in a live interview. “I’m not going to go into the rest of the list.”
that will list includes a handful of some other candidates, at least two of whom are considered stronger bets than Yellen to assume the reins when her term expires in February. Current Fed Governor Jerome “Jay” Powell as well as also also former Governor Kevin Warsh are considered more likely bets.
Fischer said that will Yellen has the right qualities for the job.
“Janet is actually a safe pair of hands as well as also also very Great at explaining what she’s doing as well as also also persuading people of what she’s doing. I think the item’s important,” he said.
Fischer also said he expects the Fed will be able to stick to the schedule the item has penciled in, which calls for another rate hike in December followed by three more in 2018. Fed officials are hoping the economy remains strong enough to allow the item to normalize policy after the measures the item took as the U.S. recovered coming from the financial crisis.
“that will’s achievable if we continue to run Great quality (data),” he said. “With the global economy coming up for initially as well as also also having faster growth inside global economy than we expected, there’s a Great chance of that will.”
Fischer’s resignation takes effect Friday, a move he announced in September, citing “personal reasons.” His departure comes two days before his 74th birthday.
Former President Barack Obama nominated Fischer to the Fed in October 2014.
During his tenure, the central bank began its first steps toward policy normalization after the extreme accommodation the item followed for years. The Fed has hiked its benchmark interest rate four times since December 2015 as well as also also is actually on track for one more hike in December.
The Fed that will month will begin another historic process — the reduction of its $4.5 trillion balance sheet. The process will entail the Fed allowing some of the proceeds for the bonds the item purchased during its stimulus efforts to roll off. The central bank is actually hoping that will markets see little turbulence coming from the process.
The balance sheet reduction will be slow — just $10 billion a month will be allowed to roll off at first, a number that will will increase $10 billion a quarter until the item reaches $50 billion.
In an ideal world, Fischer said, the process would certainly move more quickly.
“I wish the circumstances were such that will going faster was the right policy,” he said. “although given the uncertainty about the inflation rate approaching the 2 percent target, we have to be more careful than full speed ahead.”