President Donald Trump has tapped Jerome Powell to lead the Federal Reserve, denying Janet Yellen a second term, as he voiced confidence that the fellow Republican would be able to guide the world's largest economy through "any challenges" with his wisdom and leadership.
Powell, 64, will replace Yellen, who was nominated by Trump's predecessor Barack Obama in 2013. Her term as the US central bank's first female leader expires in February.
"I am confident that with Jay as a wise steward of the Federal Reserve, it will have the leadership it needs in the years to come," Trump said at a White House press conference.
"He's strong, he's committed, he's smart," Trump said.
It will be the first time in four decades that a new president has not asked the current Fed chair to stay on for a second term.
Trump said that he respected Yellen and called the 71- year-old "a wonderful woman who has done a terrific job." The Fed under Yellen's leadership has sharply reduced unemployment while maintaining control of inflation, coming as close to achieving its congressional mandate as at any time in its history.
If confirmed by the Senate, Powell will put his considerable talents and experience to work, leading US's independent central bank, which has the critical responsibility to set monetary policy and monitor our banking system as a whole, the president said.
Powell, a Republican and multi-millionaire, has served on the Federal Reserve Board of Governors since 2012.
He has consistently voted with Yellen to slowly raise interest rates and sell off assets that the Fed bought up in the wake of the severe recession of 2008 and 2009, indicating that he is expected to continue with the current monetary policy.
"During these five years, he has earned the respect and admiration of his colleagues for his hard work, expertise and judgement," Trump said.
"He has proven to be a consensus builder for the sound, monetary and financial policy that he so strongly believes in.
Based on his record, I am confident that Jay has the wisdom and leadership to guide our economy through any challenges that our great economy may face," said the president.
As Fed chair, a position some consider the second most powerful post in government, Powell would be the voice of an institution that is charged with keeping the economy on track by adjusting interest rates that influence the decisions of millions of Americans.
Reacting to Powell's nomination, the Dow ended at a record high yesterday.
The Dow Jones Industrial Average gained 0.3 per cent to finish at 23,514.81, about 75 points above the prior record set last Friday.
Powell has also served as undersecretary at the Department of Treasury in the administration of President George W Bush.
He also has nearly three decades of business experience.
He attended Princeton University where he received a Bachelor of Arts in Politics in 1975.
He continued his studies at Georgetown University, where he earned a Juris Doctor. Powell has also served as the editor-in-chief of the Georgetown Law Journal.
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