October 12, 2017 / 7:57 PM / 2 years ago

UPDATE 1-Trump meets economist John Taylor in Fed search - official

(Adds Taylor meeting with Trump, background)

By Steve Holland and Jeff Mason

WASHINGTON, Oct 12 (Reuters) - U.S. President Donald Trump is “some time away” from a decision on who should chair the Federal Reserve, his chief of staff said on Thursday, with another official saying Trump had met with Stanford University economist John Taylor to discuss the job.

“There’s still ongoing ... interviews,” White House chief of staff John Kelly told reporters. “All of the people that have been in to interview have been really first round draft choices, and we have more to come,” he said.

Trump told reporters late last month he had met with four candidates to lead the U.S. central bank and would make a decision “over the next two or three weeks.” Kelly’s remarks suggest a somewhat longer time frame.

Current Fed Chair Janet Yellen’s term expires in February.

In July, Trump said he might decide to renominate Yellen for a new four-year term, or turn to his top economic adviser Gary Cohn.

A White House official said Trump met with Taylor on Wednesday to discuss the job, accompanied by Vice President Mike Pence, Treasury Secretary Steve Mnuchin and other members of the team helping in the search. Last month, Trump met with former Fed Governor Kevin Warsh.

In addition to Powell, Warsh, Cohn, Taylor and Yellen, sources have said current Fed Governor Jerome Powell is also on the White House short list.

A new Fed chair would take the helm as the central bank eases well away from crisis-era policies in response to a strengthening economy and falling unemployment, though inflation still lingers below the Fed’s 2-percent goal.

Under Yellen, the Fed has raised interest rates and launched a plan to shrink its $4.5 trillion balance sheet. Much of the latter was accumulated through a controversial bond-buying program that Yellen said helped the economy avert an even deeper downturn. (Reporting by Jeff Mason and Steve Holland; Writing by Jeff Mason and Tim Ahmann; Editing by Chizu Nomiyama)

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