Yellen top runner for Fed chair

WASHINGTON - Reuters

Federal Reserve Vice Chair Janet Yellen is seen in this file photo. REUTERS photo

Federal Reserve Vice Chair Janet Yellen became the frontrunner for the U.S. central bank’s top job when President Barack Obama’s preferred candidate, former adviser Larry Summers, withdrew, sources familiar with the situation said.

If nominated and confirmed, Yellen would replace Federal Reserve Chairman Ben Bernanke, whose second term expires in January.

Summers, a former Treasury secretary under President Bill Clinton and a top economic adviser to Obama during the first two years of his presidency, dropped out of consideration for the post on Sunday because of opposition among fellow Democrats that would have made it difficult to be confirmed by the U.S. Senate. 

Yellen, who has a long career in the Fed system and chaired the White House Council for Economic Advisers under Clinton, would be the first woman to hold the job.

People familiar with the situation said Obama had largely whittled down his decision to two candidates, Summers and Yellen. With Summers out of the picture, Yellen moved to the top of the list. The president had mentioned former Vice Chairman Donald Kohn previously as also being under consideration. Adding further candidates to the list now was seen as unlikely.

An announcement is not expected this week. White House spokesman Jay Carney told reporters earlier on Monday that Obama would announce his decision in the fall. 

“Calendar watchers will note that we are still in the summer,” Carney said. The autumn officially begins on Sept. 21.

Analysts and former administration officials said Summers’ withdrawal put Yellen in good position to be appointed.