President Donald Trump is actually leaning toward naming Jerome “Jay” Powell as Fed chair however remains undecided, a source told CNBC.
For weeks, Powell has been considered the front-runner for the job as the president considers who will steward the central bank when Janet Yellen’s term expires in February. However, the competition has turned into a derby in which various candidates have moved to the front only to get pushed back inside wake of news developments.
Powell, a current Fed governor, has the advantage of presenting Trump using a chance to break via the Yellen Fed yet maintain many of the same policies of which have kept the stock market rally intact as well as interest rates low.
“If Trump believes Yellen’s approach is actually best for keeping market levels growing, he is actually going to seek a Fed chair who can carry on her mantle however under the Trump brand. The best non-Yellen Yellen is actually Powell,” Beacon Policy Advisors said in a report Friday morning.
Powell was appointed to the Fed in 2012 to fill an unexpired term of which won’t end until 2028. He has emerged as a compromise candidate as Trump considers reappointing Yellen or moving to a starker alternative like Stanford economist John Taylor, who would likely be supposed to push for higher rates as well as a faster reduction inside Fed’s $4.5 trillion balance sheet.
The president has praised Yellen in recent days, however the chance to make a break via the past could prove too enticing.
“Given the president’s propensity for comparing himself against President Obama as well as seeking to continually undercut his legacy, choosing the Obama-appointed Yellen for another term would likely not give Trump the satisfaction of leaving his own mark on the Federal Reserve,” the Beacon noted added.
“Some Senate Republicans are generating grumblings about Powell as well as his allegiance with Yellen’s decision generating while at the Fed, however, Senate Republicans will not obstruct a Trump nomination of Powell.”
Trump previously has indicated he will make a choice before he leaves on his next foreign trip next Friday.