White House seeking support for Yellen as Fed chief

Washington: White House officials are mustering support among Democrats on the Senate Banking Committee to back Federal Reserve Vice Chair Janet Yellen, three sources said on Friday, laying the groundwork for her expected nomination to the Fed’s top job. Two Senate Democratic aides, who requested anonymity, said officials had encouraged senators to support Yellen and talk her up, hardening the sense that President Barack Obama has settled on her to replace Fed chief Ben Bernanke when his term ends in January. A third source familiar with the calls said the White House had reached out to some of the 20 Democratic senators who had signed a letter to Obama in July urging him to appoint Yellen, who would be the first woman to hold the job if confirmed by the Senate. [caption id=“attachment_1124813” align=“alignleft” width=“380”]  Yellen, will be the first woman to hold the Fed chief’s job if confirmed by the Senate. Reuters[/caption] This source said the White House had not communicated that Obama had made a decision on who to nominate, but wanted to make sure any negative reports about Yellen did not go unanswered. The outreach to Capitol Hill indicates a serious effort to make sure her confirmation would run smoothly. A White House official said earlier this week that Yellen was the leading candidate. The third source said the calls were mostly at the staff level, although some senators may have been contacted directly. Obama, who leaves on a week-long tour of Asia on October 6, is expected to announce his decision in the coming weeks. Yellen, who is seen as one of the most dovish Fed officials, is likely to enjoy solid backing from Democrats, but could draw some fire from Republicans worried that the central bank’s aggressive efforts to spur stronger economic growth could fuel inflation or asset bubbles. Democrats control the Senate 54-46, but any nomination is likely to need to secure 60 votes to overcome procedural hurdles. Republicans have not indicated whether they might seek to block a Yellen nomination. Yellen became the front runner after former Treasury Secretary Lawrence Summers withdrew from the race on Sunday in the face of opposition from liberal Democrats. Obama was felt to favor his selection. But Summers’ record of advocacy for financial deregulation, as well as remarks in the past deemed as sexist, sparked a backlash among some Democrats on the banking panel that would need to decide whether to send any nomination to the full Senate for approval. Obama said last month that Summers and Yellen were both being considered for the job, the most powerful economic office in the nation, as was former Fed vice chair Donald Kohn. One of the senate aides said Kohn’s name had not come up in the conversations with the White House. Reuters