Obama picks Janet Yellen to succeed Fed chairman Ben Bernanke

US president Barack Obama yesterday nominated noted economist Janet Yellen as the country's first woman to take the reins of the Federal Reserve, replacing outgoing chairman Ben Bernanke whose second term ends on 31 January 2014.

At a White House ceremony, the president, flanked by Yellen and Bernanke, said: "America's workers and families will have a champion in Janet."

Calling Yellen "exceptionally qualified" for what he said was one of the most important jobs in the world, Obama said: "She doesn't have a crystal ball, but what she does have is a keen understanding about how markets and the economy work, not just in theory but also in the real world. And she calls it like she sees it."

"She is a proven leader, and she's tough. Not just because she is from Brooklyn," he further added.

Yellen, 67, currently the vice chair of the Fed, said that her priorities would be strengthening the economic recovery and promote maximum employment, if she is confirmed for the post.

"While we have made progress, we have farther to go. The mandate of the Federal Reserve is to serve all the American people, and too many Americans still can't find a job and worry how they'll pay their bills and provide for their families," Yellen said.

Obama mentioned Yellen's track record of predicting the looming financial crisis of 2008-09, before it occurred.

Yellen is widely expected to continue the monitory policies initiated by Bernanke and would follow a cautious approach towards unwinding of stimulus measures that were adopted to shore up the world's largest economy following the global financial crisis.

The central bank had kept key interest rates near zero level since the onslaught of the crisis and resorted to massive bond buying programme to push down the borrowing costs and stimulate economic growth.

According to some analysts, Yellen's nomination signals continuation of the highly accommodative monitory policy stance.

The US president's choice of Yellen has come at a critical time when the country had to resort to a partial shut down and the possibility of a government default is looming if the debt ceiling of $16.7 trillion is not raised.

Obama's former economic adviser and Yellen's rival for the post, Lawrence Summers had to pull out following stiff opposition from within the Democrats, clearing the way for Yellen's nomination for the coveted post.

Despite some criticisms from the Republicans, Yellen is expected to sail through the selection process in the US Senate with widespread support from fellow Democrats.

"Given the urgent economic challenges facing our nation, I urge the Senate to confirm Janet without delay.  I am absolutely confident that she will be an exceptional chair of the Federal Reserve." Obama said.