President George W. Bush on Monday nominated top White House economist Ben Bernanke to succeed Alan Greenspan as Federal Reserve chairman, and the former Fed board governor pledged to keep faith with the Greenspan era.
If confirmed by the U.S. Senate, Bernanke, a widely respected monetary economist with a rich academic resume, would have huge sway over the world’s mightiest economy.
Greenspan, 79, is set to step down on Jan. 31 after leading the central bank for more than 18 years through a period in which he cemented a reputation as a monetary policy “maestro.”
“Ben Bernanke is the right man to build on the record Alan Greenspan has established,” Bush, flanked by Greenspan and Bernanke, said in a brief Oval Office ceremony.
U.S. stocks logged their biggest one-day gain in six months as Bernanke’s nomination laid to rest market uncertainty over who would be Greenspan’s heir. Bond prices ended lower on worries a Bernanke Fed could take an easier line on inflation, despite his assurances on Monday that he would steer the central bank along Greenspan’s course.
“Our understanding of the best practice in monetary policy evolved during Alan Greenspan’s tenure at the Fed, and it will continue to evolve in the future,” the 51-year-old Bernanke said at the White House.
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