Fischer to step down in mid-October as Fed vacancies mount

Janet Yellen's No. 2 at the Fed is stepping down

Fed's Fischer has just submitted his resignation to President Trump saying "I am writing to inform you that for personal reasons it is my intention to resign from the Board of Governors of the Federal Reserve Systemon or around October 13, 2017".

Fed Chairwoman Janet Yellen will lose a close ally when Federal Reserve Vice Chairman Stanley Fischerresigns next month.

Before joining the Board, Mr. Fischer was governor of the Bank of Israel, from 2005 to 2013.

Mr. Fischer's term as Fed vice chairman was due to end in June 2018, although his term as governor wouldn't have ended until January 31, 2020.

His resignation will provide President Donald Trump with another opportunity to reshape the Fed. Yet inflation remains below the Fed's target, complicating its future course.

Nichols noted that Fischer's departure leaves yet another open seat on the Federal Reserve board, which already has three vacancies in addition to the one Fischer will create.

In addition to the pending vacancies at the top of the Fed, there are now three vacancies on the Fed's Board of Governors, who along with five rotating regional Fed chairs comprise the 12-member FOMC.

"That being said, the other most likely candidate for the position is Gary Cohn who would likely continue the gradualist approach to monetary tightening".

In a statement on Wednesday, Yellen said, "Stan's keen insights, grounded in a lifetime of exemplary scholarship and public service, contributed invaluably to our monetary policy deliberations". For more than 20 years, he was a professor at the Massachusetts Institute of Technology, where he influenced generations of economists, from former Fed Chairman Ben Bernanke to European Central Bank chief Mario Draghi.

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