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Donald Trump is said to select Jerome Powell as new Fed chairman, replacing Yellen

Powell, appointed as Fed Governor by Obama, has a reputation as a non-ideological policymaker who has generally backed Yellen’s cautious approach

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Jerome Powell, governor of the US Federal Reserve,is said to be US President Donald Trump's pick to lead the US central bank. Photo: Bloomberg

US President Donald Trump plans to nominate Federal Reserve Governor Jerome Powell to be the next chairman at the US central bank, three people familiar with the decision said.

Trump, who has said he’ll announce his pick Thursday, would be choosing a former private-equity executive who favours continuing gradual interest rate increases and sympathises with White House calls to ease financial regulations. The immediate market reaction was muted, with the dollar briefly paring gains while stocks and bonds were little changed.

Powell declined to comment when approached by a reporter outside his Washington-area home. The Wall Street Journal earlier reported Trump has selected Powell.

If approved by the Senate, the 64-year-old former Carlyle Group LP managing director and ex-Treasury undersecretary would succeed Fed Chair Janet Yellen, who has raised borrowing costs four times starting in late 2015 and just begun scaling back the central bank’s US$4.5 trillion balance sheet.

A Republican appointed to the Fed in 2012 by Democratic President Barack Obama, Powell has earned a reputation as a non-ideological and pragmatic policymaker. While he hasn’t played a prominent public role in formulating and explaining monetary policy, he has generally backed Yellen’s cautious approach to withdrawing stimulus.
Current Federal Reserve Chair Janet Yellen (left), and Fed governor Jerome Powell, who is said to have been chosen by US President Donald Trump to replace her. Photo: AFP
Current Federal Reserve Chair Janet Yellen (left), and Fed governor Jerome Powell, who is said to have been chosen by US President Donald Trump to replace her. Photo: AFP

“He’s going to bring continuity to monetary policy,” said John Silvia, chief economist at Wells Fargo Securities in Charlotte, North Carolina. “I’ve long argued that of the people involved, he’s probably the easiest confirmation – the Senate has confirmed him before. And he seems to be a fellow who knows what is going on.”

Under Yellen, whose four-year term as chair expires February 3, the Fed has overseen an economic expansion now in its ninth year and a fall in unemployment to a 16-year low. It would be up to Powell to keep that growth on track, under a president who has stated a preference for much faster gains in gross domestic product and continued low interest rates.

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