Trump May Be Close to Appointing Jerome Powell and John Taylor to the Fed

The US Federal Reserve said recent hurricanes are "inflicting severe hardship" but that the economic impact will likely only be short-term

President Donald Trump appears to be moving closer to a decision on appointments to two top leadership positions at the Federal Reserve.

Trump said in a Fox Business interview that he is leaning toward appointing current Fed governor Jerome Powell to succeed Janet Yellen as chair of the central bank. He also said he is considering appointing Stanford economist John Taylor as vice-chair of the Fed.

The president made his statements in an interview for the Fox Business program  Sunday Morning Futuresaccording to the network.

Fox reports:

President Donald Trump may give the Federal Reserve a double dose of top talent by nominating two top contenders, Federal Reserve Governor Jerome Powell and Stanford University economist John Taylor, as candidates for either Fed chairman and vice chairman, but it is still unclear which role either would get, FOX Business has learned.

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As the decision comes down to the wire, President Trump may decide to reward two factions within the White House that are involved with the search process, one led by Treasury Secretary Steven Mnuchin, who prefers Powell, and the other by Vice President Mike Pence, who favors Taylor, according to those familiar with the matter.

The report comes just one day after current chair Yellen met with Trump at the White House for an interview on her possible reappointment. On Wall Street, many suspect that the Trump interview is an indicator that Trump has decided not to appoint Yellen. In recent days, conservative House Republicans had begun to organize a campaign to convince the president not to re-appoint Yellen.

Taylor is a favorite among Capitol Hill Republicans. They admire his view that the Fed’s monetary policy should be largely rule-and-data based rather than decided by fuzzier factors and moving targets, as often has been the case under Yellen and her predecessor Ben Bernanke. It is thought that in today’s economic environment, Taylor would favor a more rapid rise in interest rates.

Powell has long been a part of the Republican establishment. His appointment as chair would likely indicate a continuation of current Fed policies but without the political baggage of re-appointing Yellen.