Jan 30 (Reuters) - President Donald Trump said on Thursday he intends to announce his pick to replace Federal Reserve Chair Jerome Powell on Friday, with speculation intensifying that the nod will go to former Fed governor Kevin Warsh.
Bloomberg News later reported that the White House is preparing for Trump to nominate Warsh as the next Fed chair, citing people familiar with the matter.
Warsh, on the short list of candidates to lead the central bank when Powell's leadership term ends in May, went
to the White House for a meeting with Trump on Thursday, according to one source familiar with the matter.
COMMENTS:
KHOON GOH, HEAD OF ASIA RESEARCH, ANZ, SINGAPORE:
"I guess the appointment of Warsh, if it's true, will be seen as someone who can, in a way, remain independent, and not someone seen as likely to be subservient to Trump's wishes.
"The more telling would be how the market actually reacts when President Trump finally announces his pick.
"But I think the other thing as well, the dollar's had a big yo-yo move this week, so some of these FX moves, I think I don't want to put too much focus on it, because it could just be position squaring. Ahead of the announcement, people might just be lightening up risk.
"And the other thing as well is, especially on a Friday, if you think about it from an investor or market participant point of view ... What happened in the first weekend of January? Venezuela. What happened in the second weekend? The Greenland thing. And who knows, now there's potential around Iran, right?
"So any sensible market participant would not want to carry a big position into the weekend ... so some of this could just be positioning lightening up. If you're short dollars, you've done well, take your chips off the table."
RODRIGO CATRIL, SENIOR FX STRATEGIST, NATIONAL AUSTRALIA BANK, SYDNEY:
"The Warsh story, if true, could be quite significant in the sense that he is regarded as a well-respected economist, and importantly, too, he gave a speech back in April last year, and in the speech he not only was a staunch defender of the Fed independence, but he was also very critical of the Fed and other central banks not speaking to their mandates.
"So overall, the market reaction, it's been positive for the U.S. dollar because a Warsh appointment would not only play to the view that Fed independence will be protected, it would also play to the view that whilst some reforms should be expected, it's not going to really dramatically change the Fed. And in particular, it's also not going to necessarily mean that now we have a Fed that is at the whims of what President Trump or any other presidents would like them to do."
TIM KELLEHER, HEAD OF INSTITUTIONAL FX SALES, COMMONWEALTH BANK, AUCKLAND:
"We've definitely seen some dollar buying straight away on the back of it.
"The fact that it's most likely to be Warsh, I doubt we get much of a knee-jerk reaction as if we'd got Rick from BlackRock.
"He's known to the markets and probably calm things down slightly.
"The inference we're seeing is that he's more of a steady pair of hands rather than a slash-and-burn, Stephen Miran sort of guy."
(Reporting by Rae Wee and Gregor Stuart Hunter in Singapore, and Kevin Buckland in Tokyo; Editing by Sumeet Chatterjee and Tom Hogue)
