Monday 23 October 2017

Stanley Fischer: US Federal Reserve vice-chair resigns year before terms ends citing 'personal reasons'

U.S. Federal Reserve Vice Chair Stanley Fischer REUTERS/Brendan McDermid/File Photo
U.S. Federal Reserve Vice Chair Stanley Fischer REUTERS/Brendan McDermid/File Photo

Ben Chu

Stanley Fischer, the vice-chair of the US central bank, has resigned a year before his term was due to end, citing "personal reasons".

In a letter to President Trump Mr Fischer, 73, said he would step down from the Federal Reserve "around 13 October".

Mr Fischer was appointed by former President Barack Obama in 2014 and his term would normally have ended in June 2018.

The term of the current chair of the Fed, Janet Yellen, is due to end in February 2018. Mr Trump has said she could be re-appointed, though other candidates are also under consideration.

"The markets will jump to the conclusion that this lowers the odds of President Donald Trump nominating Yellen for a second term as Chair," said Paul Ashworth of Capital Economics.

"Yellen and Fischer are viewed as being close and appear to share very similar views on both the monetary policy outlook and regulatory issues."

Mr Fischer is a highly influential former economics professor at the Massachusetts Institute of Technology.

He was Governor of the Bank of Israel between 2004 and 2013.

Gary Cohn, Mr Trump's top economic advisor, who is Jewish, is reported to have seriously considered resigning after the President defended neo-Nazi protestors last month.

Mr Fischer also recently criticised attempts by the Trump administration to dismantle some of the post-financial crisis regulation and stress testing of US banks as "very, very dangerous".

In his resignation letter Mr Fischer wrote: "Informed by the lessons of the recent financial crisis, we have built upon earlier steps to make the financial system stronger and more resilient and better able to provide the credit so vital to the prosperity of our country's households and businesses".

He also said it had been a "great privilege" to work alongside Ms Yellen.

Ms Yellen said: "I'm personally grateful for his friendship and his service. We will miss his wise counsel, good humor, and dry wit."

Mark Carney, the Governor of the Bank of England, also paid a glowing tribute to Mr Fischer.

"The combination of his encyclopaedic knowledge of economics, outstanding judgment, quiet leadership and his perennial good humour has helped policymakers around the world to navigate one of the most challenging periods in the global economy," Mr Carney said in a statement.

Independent News Service

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