SF Fed’s Williams front-runner for NY Fed post: Wall Street Journal

NEW YORK (Reuters) – John Williams, president of the Federal Reserve Bank of San Francisco, is the leading candidate to succeed William Dudley as head of the New York Fed, the Wall Street Journal reported on Saturday citing unnamed people familiar with the matter.

The paper said the New York Fed’s board of directors had recommended Williams for the job, seen by many as the second-most influential at the U.S. central bank, though it added the situation could yet change.

The New York Fed and the San Francisco Fed declined to comment.

On March 16, the New York Fed said it was considering “a handful” of final candidates to replace Dudley, who plans to step down by mid-year.

The New York Fed’s president has a permanent vote on interest-rate policy, serves as vice chair of the policy-making committee, oversees market operations including $4.4 trillion in assets, and supervises Wall Street.

Williams, a long-time Fed economist who succeeded Janet Yellen as San Francisco Fed president in 2011, has supported the central bank’s gradual interest-rate hikes and has recently advocated for a reconsideration of the traditional inflation-targeting regime.

Reuters reported on March 1 that Richard Clarida, an economist at fund manager Pimco, was front-runner to become the Fed’s vice chair, a position chosen by the White House. It also reported that Fed Chair Jerome Powell was playing a larger role than his predecessors in making his views known to the White House and to the New York Fed, and that he had initially supported Williams for the Fed Vice Chair job.

The New York Fed directors and the Fed Board could face criticism were they to ultimately choose Williams. The decision has attracted scrutiny from Democratic lawmakers and activists urging a candidate who breaks with past precedent.

The Journal also reported that two other people short-listed for the job are: Raymond McGuire, the corporate and investment-banking head at Citigroup Inc (NYSE:); and Mary Miller, a former senior Treasury official who Reuters previously reported was being considered.

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