Fed: Choice of Powell as Fed Chair suggests no change in policy - Nomura
In the US, President Trump nominated Fed Governor Jerome Powell to serve as the next Fed chairman instead of reappointing Janet Yellen who is a similar candidate, according to Richard Koo, chief economist at Nomura.
“The one accomplishment Mr. Trump can claim in his time as president is a strong real economy. Inasmuch as this is attributable to Ms. Yellen’s capable guidance, the president had no reason to risk a change in the Fed’s basic policy stance. To the extent that Republican members of Congress might have opposed the reappointment of the Democratic-leaning Ms. Yellen, I view the “promotion” of Mr. Powell as a way for the president to keep the economic expansion on track by preserving the Fed’s current approach.”
“Mr. Trump may well have selected someone closer to him if he had already achieved significant accomplishments as president, but in reality, he did not have that luxury.”