US President Barack Obama has nominated Janet Yellen as chair of the Board of Governors of the Federal Reserve, describing her as one of America's "foremost economists and policy makers".
If confirmed by the Senate, 67-year-old Yellen would be the first woman to hold the position of the chief banker.
She has been named in place of Ben Bernanke, whose four-year term ends on January 31.
Describing the chair of the Fed as one of the most important policymakers in the world, Obama yesterday said Yellen has been exemplary and a driving force of policies to help boost American economic recovery.
"Janet is exceptionally well-qualified for this role. She's served in leadership positions at the Fed for more than a decade. As Vice Chair for the past three years, she's been exemplary and a driving force of policies to help boost our economic recovery," he said.
"Janet is renowned for her good judgment. She sounded the alarm early about the housing bubble, about excesses in the financial sector, and about the risks of a major recession. She doesn't have a crystal ball, but what she does have is a keen understanding about how markets and the economy work -- not just in theory but also in the real world. And she calls it like she sees it," Obama said.
Noting that the past six years have been tumultuous for the economy and challenging for many Americans, Yellen said though more needs to be done to strengthen the recovery, particularly for those hardest hit by the Great Recession, the country has made progress under Obama.
"The economy is stronger and the financial system sounder," she argued.
"While we have made progress, we have farther to go.?The mandate of the Federal Reserve is to serve all the American people, and too many Americans still can't find a job and worry how they?ll pay their bills and provide for their families," she said.
"The Federal Reserve can help if it does its job effectively.?We can help ensure that everyone has the opportunity to work hard and build a better life. We can ensure that inflation remains in check and doesn't undermine the benefits of a growing economy. We can, and must, safeguard the financial system," Yellen said.
Welcoming the nomination, Senator Harry Reid, the Senate Majority Leader, said Yellen will succeed a consummate professional who steered the national and the global economies through the worst crisis since the Great Depression.
The Wall Street Journal - the premier financial daily - said that Yellen will have to figure out when and how to stop increasing the Fed portfolio from $ 860 billion to $3.8 trillion, which has been adding to it by printing $85 billion a month to buy bonds and mortgage securities.
"Yellen would bring a formidable intellect to the job, and far more experience in making monetary-policy decisions than any of the 14 men who have preceded her," it said.
"She has been thinking, studying and speaking about how today's unconventional monetary policy actually works (an open question among economists), about how to use these new tools in today's unusual economy to bring unemployment down without generating too much inflation and about how to avoid exiting too soon or too late," The Journal said.