Timothy Geithner, who steps down as U.S. Treasury secretary on Friday, has ruled himself out of the running as a future chairman of the Federal Reserve.
“Not a chance,” he told Politico in an interview posted on its website on Friday. “I have great respect for the institution but that will be someone else’s privilege.”
Mr. Geithner had been viewed as a top candidate to replace current Fed chief Ben Bernanke, whose second four-year term as chairman of the U.S. central bank ends on Jan. 31, 2014. While Bernanke has been publicly silent on his future plans, it is widely expected that he will step down when his term expires.
Current Fed Vice Chairwoman Janet Yellen is seen as a top contender to take the Fed’s helm if and when Mr. Bernanke departs. If she did, it would mark the first time the 100-year old institution had been led by a woman.
Viewed as a policy dove by fellow economists because of her emphasis on the need to tackle high unemployment versus the risk of permitting future inflation, Ms. Yellen has been a strong supporter of Mr. Bernanke’s bold action to spur U.S. growth.
The central bank has held overnight interest rates near zero since December 2008 and it has more than tripled its balance sheet to $2.99-trillion (U.S.) with a series of asset purchase programs meant to drive other borrowing costs lower.
The Fed says it will keep interest rates near zero until unemployment falls to 6.5 per cent, provided inflation doesn’t threaten to breach 2.5 per cent. The jobless rate stood at 7.8 per cent in December.
According to its own forecasts, the Fed’s interest rate guidance implies policy makers will hold interest rates down until some time in 2015, well after Mr. Bernanke’s term ends.
Other potential contenders for the top Fed slot include former Treasury Secretary Lawrence Summers and three former Fed vice chairmen: Donald Kohn, now at the Brookings Institution; Roger Ferguson, head of school and college retirement service provider TIAA-CREF; and Princeton professor Alan Blinder.
Mr. Geithner, who was president of the New York Fed before taking the top Treasury job, told Politico that he was returning to New York to be with his family and said that he has no immediate plans beyond relaxing and traveling with his wife.