Fischer confirmed to be No. 2 at Fed

Reuters News
Posted: Jun 12, 2014 2:53 PM

WASHINGTON (Reuters) - Stanley Fischer, the former head of the Bank of Israel, won approval from the U.S. Senate on Thursday to serve as vice chairman at the Federal Reserve, a role that gives him a powerful perch to help shape U.S. monetary policy.

He already had been confirmed last month as a member of the Fed's board.

Fischer, who was credited with ably steering Israel's economy through the financial crisis, is a widely respected economist who is expected to prove an important ally of Fed Chair Janet Yellen as she crafts a strategy to withdraw the central bank's extraordinary support for the economy.

In the near-term, the course seems smooth. Fed board governors and regional bank presidents have been generally optimistic about the pace of economic growth, and have held to a consensus that the main stimulus program of monthly bond buying could decline gradually and end later this year.

Still-high unemployment and low inflation mean a decision to raise interest rates, which have been held near zero since late-2008, is unlikely until perhaps the middle of next year.

But between now and then, the central bank will face an array of issues it must tackle to set the stage for that initial rate increase.

(Reporting by Howard Schneider and Krista Hughes; Editing by Andrea Ricci)