Obama selects new No. 2 at Fed

Associated PressJanuary 10, 2014 

— President Barack Obama took a step Friday toward reshaping the Federal Reserve under incoming Chairwoman Janet Yellen, choosing a leading expert on the global economy to be her vice chairman.

Obama said he will nominate Stanley Fischer, a former head of the Bank of Israel, for the No. 2 job at the Fed. He would replace Yellen, who was confirmed this week to lead the Fed.

Fischer, a dual citizen of the United States and Israel, was a longtime professor at the Massachusetts Institute of Technology. Departing Fed Chairman Ben Bernanke and Mario Draghi, the current head of the European Central Bank, were among his students.

Obama also is nominating Lael Brainard as a Fed governor. Brainard served as the undersecretary for international affairs at Treasury during Obama’s first term. She left the administration recently. He is also renominating Jerome Powell to the Fed for a second term.

All three nominations must be confirmed by the Senate.

The selections were largely expected and did little to change economists’ outlook for Fed policy this year. All three will likely support Yellen’s approach to fighting high unemployment as long as inflation stays low. And all three are likely to back plans to gradually withdraw some of that support, if the economy continues to show improvement.

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