Trump adviser: Fed chair Janet Yellen can stay

Lending

It seems President-elect Donald Trump may have changed his tone slightly when it comes to Federal Reserve Chair Janet Yellen.

Back in April, HousingWire ran the headline, “Trump: If I win, Yellen’s days at the Fed will be numbered.”

In fact, even after Trump won the election Tuesday night, experts still speculated that Yellen will resign from her position immediately.

“Given the adverse market reaction we have already seen, the Fed’s planned December rate hike is now off the table,” said Capital Economics Chief Economist Paul Ashworth. “There is a possibility that Fed Chair Janet Yellen and even some other Fed Governors (Lael Brainard??) will resign immediately.”

[NOTE: Lael Brainard is a member of the Board of Governors of the Federal Reserve System. Dr. Brainard served as Undersecretary of the U.S. Department of Treasury from 2010 to 2013 and Counselor to the Secretary of the Treasury in 2009.]

Now, however, an economic adviser to Trump, Judy Shelton, said the president-elect is not looking for Yellen’s resignation, according to an article by Kate Davidson and Greg Ip for The Wall Street Journal.

While he does not expect Yellen to resign before her term ends in February 2018, Trump is not likely to elect her for another term.

From the article:

Ms. Yellen’s term as chairwoman expires in February, 2018. Ms. Shelton suggested Mr. Trump wouldn’t nominate Ms. Yellen to a second term and instead would name someone else to take the helm. Paraphrasing Mr. Trump’s comments, Ms. Shelton said, “He’s saying he’d want someone whose thinking is more in keeping with his own.”

Her term as a member of the Fed Board of Governors expires in January, 2024, and she could stay in that role until then regardless of whether she’s chairwoman. However, Fed leaders have traditionally left the central bank when their term in the top job ends.

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