Fischer's Exit Will Leave Fed Board With More Vacancies Than Occupants

Javier Howell
September 7, 2017

US Federal Reserve Board vice chairman and former Governor of the Bank of Israel Stanley Fischer has announced his resignation, effective as of October 13, after serving a three-year term.

The resignation will provide Trump with another opportunity to reshape the Fed.

Yellen's term as Fed chair ends in February.

Diane Swonk, chief economist at DS Economics and a longtime Fed watcher, said Fischer's resignation could make it more likely that the Trump White House will simply re-nominate Yellen, rather than naming a new Fed chair.

"It has been a great privilege to serve on the Federal Reserve Board and, most especially, to work alongside Chair Yellen as well as many other dedicated and talented men and women throughout the Federal Reserve System". Fed watchers had thought he would step down, but had not expected it to be so soon.

Last month, Yellen spoke at the annual Jackson Hole Symposium, the year's top meeting of central bankers and economists from around the world, and gave an ardent defense of the USA government and the Fed's regulatory response to the financial crisis. "It adds a further element of uncertainty to policy and who will be running policy early next year". He has nominated Randal Quarles for one of the vacancies, as vice chairman for bank supervision. "It adds to the cloudiness of the outlook for monetary policy".

Former Board of Governors member Daniel Tarullo stepped down in April.

Fed Chair Janet Yellen said Fisher would be missed.

Fischer is an elder statesman of American finance.

He has also held the job of vice chairman of Citigroup and was deputy director of the International Monetary Fund for almost seven years. He also taught economics at MIT for more than 20 years-former Fed chairman Ben Bernanke was a student.

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