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Business

Summers rumored to be named new US Fed chairman

US President Barack Obama will nominate his former economic adviser Lawrence Summers as new US Fed Chairman, Japan’s business daily Nikkei has reported. Obama will announce his decision next week, the newspaper says.

United States President Barack Obama considered Lawrence Summers as best-suited to take over the chairmanship of the US Federal Reserve Bank, the Nikkei business daily reported Friday.

Citing unnamed sources in the White House, the Japanese newspaper said Obama would go public with the nomination next week, probably after a meeting of the central bank's Federal Open Market Committee on Tuesday and Wednesday.

Nikkei also reported that Treasury Undersecretary Lael Brainard would be named US Fed vice chairman.

Summers, who was Obama's former treasury secretary and economic adviser, is competing against Fed vice chairwoman Janet Yellen for the top job at the US central bank. The bank's current chairman Ben Bernanke is due to resign at the end of his tenure next January.

Obama is likely to face difficulties in bringing the nomination through the US congress as Summers is controversial among Republican as well as Democrat senators.

On Thursday, a senior Republican senator John Cornyn of Texas said he would vote against Summers.

“If you look at Larry Summers' record, he has a history of promoting stimulus funding and higher taxes,” Megan Mitchell, the spokeswoman for the Republican whip in the Senate said.

In Obama's Democratic Party, Senators Sherrod Brown of Ohio and Jeff Merkley of Oregon said they were voting against Summers, endangering a Democrat majority in the Senate Banking Committee, which is to vet any nomination.

The Nikkei daily wrote that due to the uncertainties caused by the opposition in Congress, the official announcement might be delayed further.

uhe/kms (Reuters, dpa)