US Federal Reserve head - Janet Yellen
The US Senate has confirmed Janet Yellen as the next head of the US
Federal Reserve.
Fifty-six senators voted in favour of Ms Yellen while 26 opposed.
Many members of the chamber were unable to attend the vote because of
bad weather.
It was the last procedural hurdle for the 67-year-old before taking
over from outgoing chair Ben Bernanke on February 1. She is the first
woman to lead the Central Bank in its 100-year history.
President Barack Obama said, "The American people will have a fierce
champion who understands that the ultimate goal of economic and
financial policy-making is to improve the lives, jobs and standard of
living of American workers and their families."
Originally from Brooklyn, New York, Ms Yellen served as chair of
former US President Bill Clinton's Council of Economic Advisers and was
an Economics Professor at the University of California, Berkeley.
During the Senate session to confirm her as the head of the Central
Bank, many Senators praised her long-term focus on unemployment.
Ms Yellen is the first Fed chair nominated by a Democratic President
since Paul Volcker left the top spot in 1987. She will face a difficult
road ahead once Bernanke steps down after eight years in office.
Although most analysts expect Ms Yellen to continue Bernanke's
efforts to boost the US economy by keeping short term interest rates
low, she will eventually face unchartered territory once the Central
Bank begins to ease back on its extraordinary measures.
Ms Yellen was a strong supporter of the Fed's current stimulus
efforts - a $75 billion a month bond buying program known as
quantitative easing.
By buying bonds, particularly mortgage bonds, the Fed has tried to
keep long term interest rates low to spur housing activity and encourage
investors to spend, rather than save, their money.
In doing so, the Fed has amassed close to $4 trillion in assets since
it first initiated its stimulus efforts in the wake of the 2008-2009
financial collapse - a fact that some senators criticised during
Monday's confirmation hearings.
Although the Central Bank announced plans to cut its purchases from
$85 billion a month to $75 billion a month in December, Ms Yellen faces
the difficult task of assessing when and how to ease stimulus efforts.
The Fed admitted recently that its projections for the US economy
over the past few years have been overly optimistic, forcing it to
continue its extraordinary measures for longer than initially intended.
BBC
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