President Donald Trump has announced Jerome Powell as his pick to become the new chair of the Federal Reserve – a move that is unlikely to affect the roaring stock market.
“He’s strong, he’s committed, he’s smart,” Mr Trump said in the White’s House Rose Garden, where he introduced Mr Powell as his pick to lead the word’s most powerful central bank – a position that some consider to be the most second powerful post in government.
“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 will face,” the President added, using Mr Powell’s nickname.
Mr Powell has served on the Federal Reserve Board of Governors since 2012. As the economy continues to grow, he is expected to continue the monetary policy that has come to define his predecessor Janet Yellen’s term. It is uncertain what he would do if the economy took a dive.
“During his five years at the Fed, Jay has earned the respect and admiration of his colleagues,” Mr Trump said. “He has proven to be a consensus builder for the strong monetary and financial policy that he so strongly believes in.”
Mr Powell thanked the President for “the faith he has shown in me through this nomination”, saying he is “both honoured and humbled by this opportunity to serve our great country.”
“If I am confirmed by the Senate, I will do everything in my power to achieve our Congressionally-assigned goals of stable prices and maximum employment,” Mr Powell said. He received support from Democrats both times he was approved as Fed governor by the upper chamber – in 2012 and 2014.
The 64-year-old former investment banker was not on Mr Trump’s early radar as a possible successor to Ms Yellen. He had been angling instead for a job as the US central bank’s vice chair for supervision, but was passed over for that position last summer.
Other contenders for the top job at the Fed were eliminated for different reasons, as Mr Trump soured on top White House economic adviser Gary Cohn, decided against reappointing Ms Yellen despite largely approving of her policies, and came to view two others as posing risks to the economy.
In the end it was Mr Powell, a Maryland native, avid cyclist, and guitar hobbyist, who checked all the boxes that mattered to Mr Trump but carried none of the negatives.
If confirmed by the US Senate, Mr Powell would become the first person without an advanced economics degree to hold the job since William Miller in the late 1970s.
A lawyer who lists personal assets of between $20 million and $60 million on government disclosure forms, Mr Powell has worked in investment banking and served on corporate boards as a managing partner at the Carlyle Group, a private equity firm.
Mr Trump is breaking precedent by replacing Ms Yellen: It is the first time in 40 years that a president isn’t asking an incumbent to stay on as head of the Fed.
His relationship with Ms Yellen has evolved over the past couple of years. During the presidential campaign, the real estate tycoon criticised the economist, saying she should be “ashamed” of the way she has run the central bank.
But after entering office, his public words toward her softened. On Thursday, he called her “a wonderful woman who has done a terrific job.”
“We have been working together for 10 months and she is absolutely a spectacular person,” Mr Trump said. “Janet, thank you very much, we appreciate it. For the past four years, she has served with dedication and devotion and we are grateful for her total commitment to public service.”