October 9, 2013 - 10:31 AMT
PanARMENIAN.Net - President Barack Obama will nominate Federal Reserve Vice Chair Janet Yellen to be the next head of the U.S. central bank on Wednesday, Oct 9, putting her on course to be the first woman to lead the institution in its 100-year history, according to Reuters.
Yellen, who would replace Ben Bernanke when his second term as Fed chairman expires on January 31, has been a forceful advocate for aggressive action to stimulate U.S. economic growth through low interest rates and large-scale bond purchases.
If confirmed by the U.S. Senate, she would provide continuity with the policies the Fed has established under Bernanke and would be expected to tread carefully in winding down the extraordinary stimulus the central bank put in place to shore up the world's largest economy.
Her nomination comes during a political stalemate in Washington that has closed the U.S. government and threatened a U.S. default if lawmakers fail to raise the debt ceiling by an October 17 deadline.
Obama is scheduled to make the announcement of his choice at the White House at 3 pm EDT (1900 GMT), a White House official said on Tuesday. Bernanke is also expected to attend.
Yellen has enjoyed strong support from Democrats. In an unusual move, 20 Senate Democrats signed a letter earlier this year pressing Obama to turn to the former professor from the University of California at Berkeley.
Her backing on the Republican side of the aisle is much softer. Many Republicans worry the Fed's policy of holding overnight interest rates at zero and the massive bond purchases it has pursued to drive other borrowing costs lower threaten to create asset bubbles and spark an unwanted pickup in inflation.
"I voted against Vice Chairman Yellen's original nomination to the Fed in 2010 because of her dovish views on monetary policy," said Senator Bob Corker of Tennessee in a statement. "We will closely examine her record since that time, but I am not aware of anything that demonstrates her views have changed."
Senator Richard Shelby of Alabama, another Republican, said he has concerns about her "proclivity to print money" and her record as a bank regulator.
Still, Yellen is expected to garner enough support to secure the 60 votes needed to overcome any procedural hurdles in the 100-seat Senate. Democrats control the chamber 54-46.
A respected economist whose research has taken her deep into theories of monetary policy, Yellen has earned a reputation as one of the Fed officials most worried about unemployment and least concerned about inflation.
"With employment so far from its maximum level and with inflation running below the committee's 2 percent objective, I believe it's appropriate for progress in the labor market to take center stage in the conduct of monetary policy," she said in March.