Trump intends to nominate ex-Fed economist Liang for Fed board seat: White House

FILE PHOTO: The Federal Reserve building is pictured in Washington, DC, U.S., August 22, 2018. REUTERS/Chris Wattie/File Photo

WASHINGTON (Reuters) - U.S. President Donald Trump intends to nominate former Federal Reserve economist Nellie Liang to the U.S. central bank’s board of governors, the White House said on Wednesday.

Earlier, two White House officials speaking on condition of anonymity told Reuters that Liang has a strong background on financial and monetary stability, including crisis response, and is considered a good fit for the Fed board.

Liang established the Fed’s Division of Financial Stability in 2010. She joined the Brookings Institution in 2017.

In an Aug. 20 interview with Reuters, Trump said he was “not thrilled” with the Federal Reserve under his own appointee, Chairman Jerome Powell, for raising interest rates and said it should do more to help him to boost the economy.

Liang is a senior fellow in economic studies at the Brookings Institution and a visiting scholar at the International Monetary Fund’s monetary and capital markets department.

Liang spent the bulk of her career as an economist at the Fed, and was tapped in the wake of the 2007 to 2009 recession to build out its fledgling office of financial stability.

Issues around financial stability have figured increasingly in the Fed’s policy debates, as policymakers created new oversight strategies like the stress testing of banks and deliberated over whether financial market risks should influence the path of interest rates.

In a paper presented at Brookings last week Liang argued that officials should get in front of potential problems early and forcefully, a perspective she would carry to the board as the Fed considers how to prepare for any future downturn.

Reporting by Steve Holland and Howard Schneider; Additional reporting by Lisa Lambert; editing by Diane Craft and James Dalgleish