Obama suggests Bernanke on way out as Fed Reserve head

President Obama strongly suggested Monday that Federal Reserve Chairman Ben Bernanke will not be extending his stay as head of the U.S. central bank.

The president said in an interview with PBS’s Charlie Rose that Bernanke has done an “outstanding job,” but has “already stayed a lot longer than he wanted or he was supposed to.” 

{mosads}The president’s comments should fuel the widely held expectation that Bernanke will not be seeking a third term as Fed chairman when his term expires at the beginning of 2014.

Rose asked Obama if he would reappoint Bernanke if the economist wanted it, and the president largely avoided the question, referring instead to what Bernanke has already accomplished.

“He has been an outstanding partner along with the White House, in helping us recover — much stronger than, for example, our European partners — from what could have been an economic crisis of epic proportions,” he said, according to an interview transcript.

Bernanke himself has been mostly mum on the topic when asked, but has done little to dissuade the notion that he has had his fill of steering the nation’s monetary policy. 

First nominated by President George W. Bush and then a second time by Obama, Bernanke’s time included navigating the Fed — and the nation’s economy — through the financial crisis and resulting recession.

Along the way, the Fed has embarked on unprecedented policy maneuvers, including three rounds of massive bond purchases known as “quantitative easing” and novel new communications strategies, such as regular press conferences and setting specific economic targets that will lead to policy changes. 

Those efforts have subjected the Fed to criticism, particularly from the right, as Republicans argue the Fed is departing from its traditional mission and potentially encouraging damaging inflation down the line.

Bernanke will likely have to field questions himself about his future at the Fed on Wednesday, when he holds one of those press conferences after the Fed updates its policy at a regular meeting. 

Financial markets are watching the Fed even more closely than usual now, wondering when the central bank might indicate it will ease off the stimulus it has pumped into the economy for years.

Obama also indicated in his interview that with the crisis faded and the economy now on a seemingly stable recovery, he would like to focus on economic matters that originally drove his run for the White House, such as income inequality and other “structural problems” in the economy.

“The economy is not working for everybody,” he said. “We have recovered from the worst of the crisis, but the underlying problem, which is growing inequality, wages and income stagnant or even going down in some cases for middle class families, that trend line has continued.”