Jerome Powell: new Federal Reserve head approved by Senate

What does Powell’s appointment mean for global economy?

Jerome Powell
Jerome Powell received backing from both parties
(Image credit: Drew Angerer/Getty Images)

The US Senate has confirmed Donald Trump’s pick to replace Janet Yellen as the new head of the Federal Reserve, the world’s most powerful banker.

Jerome Powell, a Republican who also received support from a large number of Democrats, is seen a centrist on monetary policy and is known “as a pragmatic and down-to-earth official with private sector and government experience”, the Financial Times reports.

A former private equity executive who also served in the Treasury under former president George H. W. Bush, he will be the first head of the Federal Reserve in almost 40 years not to have an advanced degree in economics.

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He has been hailed by moderates “as a safe choice who would provide continuity for existing US monetary policy, not rattle markets”, says the BBC, and he's expected to act as a counterweight against some of Donald Trump’s more radical ‘America First’ economic policies,

A member of the Fed’s board since 2012, Powell has in the past supported Yellen’s cautious approach to raising interest rates, although he might be “marginally more favourable toward easing some of the stricter financial rules” introduced following the 2008 financial crisis, says Associated Press.

His leadership is “likely to combine continuity on interest-rate policy with perhaps a lighter touch on financial regulation”, predicts The Wall Street Journal, which could bring him into conflict with Trump. It has been suggested that the President, who has businesses which could benefit from lower interest rates, will attempt to unduly influence Fed decisions, the BBC reports.

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