President Obama’s pick to lead the Federal Reserve appears likely to be confirmed, as several Republicans indicated Wednesday that they are open to the nomination.
Sen. Bob Corker (R-Tenn.) said he plans to support Janet Yellen, currently the No. 2 at the nation’s central bank, for the top job despite their disagreements over the limits of the Fed’s power. Corker is a member of the Senate banking committee, which is slated to vote Thursday to send Yellen’s nomination to the floor, and the first Republican to announce his approval publicly.
“I do believe she will bring a more transparent approach to Fed decisions and guidance,” Corker said. “She has the qualifications necessary to be Fed chairman.”
Democrats hold a majority in the Senate but do not have enough votes to break a Republican filibuster, making bipartisan support essential to Yellen’s confirmation. In addition to Corker, Sens. Tom Coburn (R-Okla.), Susan Collins (R-Maine) and Orrin G. Hatch (R-Utah) said this week that they have yet to make a final decision, leaving the door open for a favorable vote.
Yellen’s confirmation comes at a delicate time for the central bank. The Fed is debating when to begin scaling back its effort to goose the economy through tens of billions of dollars in bond purchases a month. Wall Street has been on edge over the timing, and the central bank has struggled to communicate its intentions clearly amid muddy economic data and dissension within its top ranks.
On Wednesday, the Fed released documents from an October meeting of senior officials that showed they believed the job market was healing and they could start reducing the stimulus program “in coming months.” But it also revealed that the Fed’s top brass still don’t agree on the best way to prepare investors and the public for the program’s inevitable wind down.
“The conversation did not lead to any clear conclusions as to how to strengthen forward guidance in order to offset any signal the market might take from tapering,” said Michael Feroli, chief U.S. economist at JPMorgan Chase.
Current Fed Chairman Ben S. Bernanke attempted to clear the air this week during a speech in Washington that highlighted the central bank’s commitment to keeping the benchmark short-term rate low even after its bond purchases end. But the yeoman’s work of shifting the Fed out of crisis mode will fall to Yellen, if she is confirmed.
Republicans focused on how she would approach that challenge during her hearing before the banking committee last week. On Wednesday, Corker said her response influenced his decision to support her nomination, even though he voted against her confirmation as vice chairman three years ago.
“During our discussions, she made a commitment to moderate purchases as soon as she believes the data supports that action and shows that the current status cannot continue,” he said.