WASHINGTON — President Trump announced Thursday that he will nominate Federal Reserve Gov. Jerome Powell to head the central bank when Fed chair Janet Yellen’s term expires in February.
The nomination was widely expected. After Trump narrowed his choices to five in recent weeks, media reports had suggested he was strongly leaning toward Powell. He is also a well-known choice for bankers, who reacted positively to the news.
“As president there are few decisions more important than nominating leaders of integrity and good judgment to hold trusted positions in public office,” Trump said during a ceremony Thursday afternoon at the White House. “It is my pleasure and my honor to nominate Jerome Powell as the next chairman of the Federal Reserve. We need strong, sound and steady leadership at the Federal Reserve. He will provide exactly that type of leadership.”
Powell said he was honored by the nomination and would use the opportunity to help bolster the nation’s economy while retaining the supervisory protections that helped strengthen the financial system.
“In the years since the global financial crisis ended, our economy has made substantial progress toward full recovery,“ Powell said. “While post-crisis improvements in regulation and supervision have helped us to achieve these gains, I will continue to work with my colleagues to ensure that the Federal Reserve remains vigilant and prepared to respond to changes in markets and evolving risks."
Yellen congratulated Powell in a statement, saying that his “long and distinguished career has been marked by dedicated public service and seriousness of purpose” and that she is “committed to working with him to ensure a smooth transition.”
The move ends months of speculation about whether Trump would reappoint Yellen, who took over as Fed chair in 2014, or choose someone more popular with congressional Republicans, such as former Fed Gov. Kevin Warsh or Stanford University economics professor John Taylor.
But the race appeared to have narrowed in recent weeks, and by Monday it had been widely telegraphed that Trump would pick Powell to replace Yellen.
Reactions to the announcement on Capitol Hill were mostly congratulatory, even from lawmakers who were rooting against his nomination.
House Financial Service Committee Chairman Jeb Hensarling, R-Texas, said that while he is “not well acquainted with Mr. Powell and advocated on behalf of another candidate,” he is committed to working with him, particularly in areas of making monetary policy more predictable and shoring up community banks.
Senate Banking Committee Chairman Mike Crapo, R-Idaho, who attended the White House ceremony, congratulated Powell on the nomination, and said he hoped he could “strike the proper balance between the need for a safe and sound financial system and the need to promote a vibrant, growing economy.”
Sen. Sherrod Brown of Ohio, the top Democrat on the Senate Banking Committee, said that he would have preferred to see Yellen reappointed but that he looks forward to hearing from Powell.
“Given the Fed’s role in implementing the post-crisis rules for Wall Street, I hope Mr. Powell won’t have the same amnesia that plagues the rest of the administration,” Brown said.