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| Bernanke takes reins at the
Fed |
White House adviser Ben Bernanke won Senate approval on Tuesday to
assume one of the world's most influential economic posts chairman of the
US Federal Reserve just after the central bank raised interest rates a
14th straight time.
In 19 minutes that marked a new era at the Fed, Capitol Hill lawmakers
approved Bernanke by voice vote to succeed retiring Alan Greenspan, and
policy-makers lifted short-term rates a quarter percentage point to 4.5
per cent.
It was the 149th and final policy meeting for the outgoing Fed chief
after over 18 years in charge.
Bernanke was sworn in for a
renewable four-year term as chairman and a 14-year board term at a private
ceremony at the Fed yesterday.
"I know this institution will go on doing extraordinary things, and I
will look on from the sidelines and cheer," Greenspan told 180 guests at a
farewell luncheon after Tuesday's rate meeting.
Greenspan has agreed to to be honorary adviser to British finance
minister Gordon Brown on global economic change after stepping down.
Global financial markets will watch closely to assess what changes
Bernanke, a former Fed governor, will make at the central bank now that he
has the top job.
Treasury bond prices fell after the meeting on the prospect the Fed has
not finished a cycle that began in mid-2004, but later recovered. The
dollar shook off early weakness while stocks closed lower.
Bernanke's nomination was so uncontroversial that some senators were
quoted in newspapers expressing surprise that hearings on it had already
been held.
"Ben has provided wise counsel and good advice as a member of my
economic team, and he will serve our nation with great distinction,"
President George W. Bush said in a statement.
Bernanke, 52, is a widely respected monetary economist and a
vocal proponent of inflation
targeting at the Fed, a move that would create more formal policy rules
than practised by Greenspan, who relied heavily on intuition and
flexibility.
(Agencies) | 
Updated: 2006-02-02 11:18
