John Williams of San Francisco Fed is Front-Runner for NY Fed Post

Photo from WSJ Graphics

On Saturday, the Wall Street Journal reported that the president of the Federal Reserve Bank of San Francisco, John Williams, is the leading candidate to take the place of William Dudley as the head of the New York Fed. The report cited unnamed people who are familiar with the matter.

The paper said that the board of directors of the New York Fed had recommended Williams for the position. Williams is perceived by many as the second-most influential at the central bank of the United States, even though it added that the situation could still change.

The San Francisco Fed and the New York Fed refused to comment regarding the matter.

On the 16th of March, the New York Fed said that it was considering “a handful” of final candidates to take the place of Dudley, who is planning to step down by the middle of this year.

The president of the New York Fed has a permanent vote on the interest-rate policy. He also serves as the vice chair of the policy-making committee, oversees the market operations including the $4.4 trillion worth of assets, and supervises Wall Street.

Williams is a long-time Fed economist who took over the position of Janet Yellen as the president of the San Francisco Fed in 2011. He has supported the gradual interest-rate hikes of the central bank and has lately advocated for a reconsideration of the conventional inflation-targeting regime.

On the 1st of March, Reuters reported that an economist at fund manager Pimco named Richard Clarida was the front-runner to become the vice chair of the Fed, a position that is by the White House. It also reported that Jerome Powell, the Fed Chair, was playing a bigger role as compared with his predecessors in making his own views known to the New York Fed and the U.S. White House, and that he had originally supported Williams for the Fed Vice Chair job.

The directors of the New York Fed and the Fed Board could receive criticism if they were to ultimately decide to choose Williams. The said decision has attracted scrutiny from various Democratic activists and lawmakers who are pushing for a candidate who breaks with prior precedent.

It was also reported by The Journal that two other people who are short-listed for the position are: the corporate and investment-banking head at Citigroup Inc, Raymond McGuire; and a former senior Treasury official, Mary Miller.