Larry Summers, the former Treasury secretary and president of Harvard University, withdrew his name from consideration for the chair of the Federal Reserve Board on Sunday. President Obama has accepted Summers’ decision. With this news, the likely front runner for the next Fed chair is Janet Yellen, the current Fed vice chair. Markets had been pricing in a modest policy tightening premium as Summers was widely expected to get the nod; as this premium dissipates we would expect lower Treasury yields and a weaker US dollar, all else equal, and perhaps support for a broader rally in risk assets.
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