Janet Yellen’s term as Federal Reserve chair is set to expire in January 2018, and she’s said on multiple occasions that she intends to fulfill her term.
But is it possible that Yellen’s time as Fed chair could extend beyond that?
In a new interview with the Wall Street Journal, President Donald Trump said that keeping Yellen as Fed chair is certainly a possibility, but added that Gary Cohn, who currently serves as the White House National Economic Council Director, is also a possibility to lead the Fed.
Cohn joined the Trump administration early on, leaving his position as the second in command at Goldman Sachs. Many observers had Cohn pegged as Goldman CEO Lloyd Blankfein’s eventual replacement, but now it appears he may end up replacing Yellen at the Fed instead.
In the interview with the WSJ, Trump was asked about the future of the Fed chair, and said that Yellen is “in the running to stay.”
That echoes his comments from April, when he also said that he may keep Yellen as Fed chair due to his preference for “low-interest rate policy.”
Those comments were counter to what Trump said when he was running for president. During the campaign, Trump said that he planned to fire Yellen early on in his presidency. And earlier in the campaign, Trump accused Yellen of conspiring with then-President Barack Obama to keep interest rates low for political reasons.
But since then, Trump changed his tune.
When asked about Yellen in the new interview with the WSJ (transcript available here), Trump said: “I have a lot of respect for her, and I like her. I’ve met her just a couple of times, but I like her. It’s early to make the decision.”
Asked why he might keep Yellen, Trump reiterated his fondness for low interest rates.
“I do like low interest rates. I mean, you know, I’m not making that a big secret,” Trump said, via the WSJ transcript. “I think low interest rates are good. I like a dollar that’s not too strong. I mean, I’ve seen strong dollars. And frankly, other than the fact that it sounds good, lots of bad things happen with a strong dollar. … I would say yes, she is in the running to stay.”
According to the WSJ transcript description of the interview, Trump was joined in Oval Office by “several of his senior staff,” including Cohn, which seemingly prompted a question about whether Cohn was in consideration to lead the Fed.
Here’s that section of the interview in full:
WSJ: Is Gary [Cohn] a candidate? (Laughter.)
PRESIDENT TRUMP: He doesn’t know this, but yes, he is. (Laughter.)
WSJ: Are there other candidates?
PRESIDENT TRUMP: I actually think he likes what he’s doing right now.
WSJ: That’s what he tells us.
PRESIDENT TRUMP: Don’t tell Gary what I just said.
Trump went on say that there are “two or three” other candidates to lead the Fed, before restating his feelings about Yellen.
“But she is – she is in the running, absolutely. I like her. I like her demeanor,” Trump said. “I think she’s done a good job. I’d like to see rates stay low. She’s always been – you know, she’s historically been a low-interest-rate person, a believer.”
While the Trump administration seems to plotting its next move at the Fed, it seems that a decision and subsequent announcement about the future of the Fed is not imminent.
In the interview, Trump said that an announcement on the next Fed chair will come “some time by the end of year, probably.”
And that means that Yellen appears likely to finish out her term, at least, just as she said she would.