Sumber: Reuters | Editor: Anna Suci Perwitasari
KONTAN.CO.ID - NEW YORK. Investors gave their approval on Monday to U.S. President-elect Joe Biden's pick of former Federal Reserve Chair Janet Yellen to be the next Treasury secretary, touting her experience at the central bank as critical to helping the country weather coronavirus-fueled economic struggles.
U.S. stocks added slightly to gains after reports that Yellen, who chaired the Fed from 2014-2018, would become the first woman to lead the Treasury, if she is confirmed.
“It’s a very good pick because she has familiarity with the markets and will work well with the Fed, given her long tenure there," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.
Biden's Treasury secretary stands to be a key player in the administration's efforts to help the country's economy recover from the coronavirus pandemic.
Among Biden's cabinet posts, his Treasury pick has been seen as one of the more likely to have the potential to swing asset prices.
The incoming Treasury chief likely will take on a crucial role in negotiating any further coronavirus economic relief package with congressional lawmakers. Markets for weeks have hung on back-and-forth negotiations for a fiscal stimulus package.
It is not the first time Yellen has been called on to help chart the country out of an economic crisis. She took over the Fed chair post from Ben Bernanke in the wake of the financial crisis over a decade ago, after serving as vice chair of the central bank.
More recently, Yellen has called for increased government spending to boost the U.S. economy out of a deep recession brought on by the coronavirus.
"Yellen should be a very strong advocate for more aggressive fiscal policy, and given her gravitas around Washington, it may make her the single most effective fiscal expansion advocate Biden could have picked,” said Tom Graff, head of fixed income at Brown Advisory in Baltimore.
Yellen, who was selected by President Barack Obama to lead the Fed during his tenure, presided over a period of low interest rates, although she was at the helm when the central bank in December 2015 lifted rates from zero.
“She seems a dovish individual as far as Fed policy is concerned and the markets like dovish policy," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.
Investors also pointed to the importance of picking someone who can work closely with the Fed in aiding the economy.
“I think it is a fine selection and she should be confirmed with ease," said Kevin Giddis, head of fixed income at Raymond James in St. Petersburg, Florida.
Biden's economic agenda has included raising taxes on wealthier Americans and corporations, changes that could rattle markets if they go forward. Yellen has frequently cited growing economic inequality in the United States as a threat to America's values and its future.
John Doyle, vice president of dealing and trading at Tempus in Washington, noted that with Republicans likely to maintain control of the U.S. Senate, "there will be handcuffs on what the Biden administration can get pushed through.”