WASHINGTON -- President-elect Joe Biden will nominate former Federal Reserve chair Janet Yellen to head the U.S. Treasury, a choice that, if confirmed by the Senate, would make her the first woman in the job.
The 74-year-old, whose nomination was confirmed to AFP by a financial source close to the Biden administration, would be tasked with steering the world's largest economy as it struggles with mass layoffs and a sharp growth slowdown caused by the COVID-19 pandemic.
"Yellen will be the next treasury secretary" and she could be formally announced as early as Tuesday, the source said, confirming news first reported by The Wall Street Journal.
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Yellen's candidacy was supported by left-wing members of Biden's Democratic Party, according to the source, and requires Senate confirmation.
Yellen broke barriers when former president Barack Obama nominated her to serve as Fed chair in 2014, a position President Donald Trump ousted her from four years later.
At the Fed, Yellen was seen as a "dove" inclined towards low interest rates to support employment.
She would succeed Steven Mnuchin, and likely be faced with breaking a months-long deadlock in Congress over passing a new stimulus spending bill for the U.S. economy -- assuming lawmakers don't act before Biden's inauguration in January.
Chief economist at Grant Thornton Diane Swonk called Yellen "a highly talented and gifted economist" on Twitter.
"She will make a great treasury secretary at a critical time and write yet another chapter in the history books," she said.
'Essential' spending
The United States is home to the world's largest COVID-19 outbreak, and as the economy convulsed Congress rallied in March to pass the $2.2 trillion CARES Act that expanded unemployment payments, supported small businesses and allocated money to hard-hit airlines to maintain their staff.
But those provisions expired over the summer, leading to 32,000 furloughs among major airlines alone and raising fears of a renewed economic slump.
Congress has been deadlocked on passing more aid, with Democrats supporting another $2.2 trillion measure but Republicans insisting on a series of smaller bills.
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Gregori Volokhine, president of Meeschaert Capital Markets, called Yellen a "friend of the markets" for supporting further spending that would boost equities, and noting her confirmation would mark a return of technocrats to the executive branch.
"After four years of political appointments, we have appointments of professionals, not only political professionals but also professionals in their professions," he said.
Currently a distinguished fellow at the Brookings Institution in Washington, Yellen has signaled her support for more spending.
"Fiscal policy has a very important role to play now," she said in an appearance this month. "I believe it's essential."
Biden, who served as vice president under Obama and defeated Trump in the Nov. 3 election, has been moving quickly to fill key slots in his incoming cabinet.
Earlier Monday, he announced a slew of appointments to key national security roles including former Obama official Antony Blinken as secretary of state.
The Dow closed up 1.1% following news of Yellen's nomination as well as another upbeat announcement concerning a COVID-19 vaccine.
