WASHINGTON — The Senate on Monday confirmed Janet Yellen to be the next leader of the Federal Reserve Board, making her the world's most powerful central banker.

Yellen, the current vice chair at the U.S. central bank, stands to become the first woman to lead the Fed in its 100-year history. It will now fall to her to be responsible for guiding the agency forward as it gradually unwinds its monthly $75 billion bond-buying program and overseeing the finalization of critical bank regulatory laws called for by the Dodd-Frank Act.

Yellen, previously the president of the San Francisco Fed and a member of the Council of Economic Advisors in the Clinton administration, will assume a four-year term as chairman on Feb. 1. President Obama first nominated her in the fall to succeed outgoing Fed Chairman Ben Bernanke, whose term expires at the end of January. She is the first Democrat to hold the job since 1987 when Paul Volcker was chairman.

"The American people will have a fierce champion who understands that the ultimate goal of economic and financial policymaking is to improve the lives, jobs and standard of living of American workers and their families," Obama said in a press release.

He noted the bipartisan confirmation vote by the Senate, which has been at loggerheads over tough fiscal issues.

Her nomination easily passed 56 to 26, with several senators absent due to weather. In contrast, Bernanke was confirmed for his second four-year term by the Senate 70 to 30, one of the smallest confirmation margins for a Fed chair.

Treasury Secretary Jack Lew said Yellen has been a "vital and often prescient voice" at the Fed demonstrating "deep understanding of the damage a difficult economy can have on working families, while noting her commitment to completing the remaining work of the Dodd-Frank Act.

Yellen received overwhelming support from Democrats, particularly those on the left. 

"In today's complex financial system, it's more important than ever that we have strong regulators like Dr. Yellen, who can recognize emerging threats to economic stability and who isn't afraid to act when they find abuses that put American consumers and workers at risk," Sen. Sherrod Brown, D-Ohio, a member of the Senate Banking Committee, said on the floor ahead of the vote.

Rep. Maxine Waters, the lead Democrat on the House Financial Services Committee, said Yellen's expertise would aid her assessment of Fed policies affecting the middle class.

"Her judgment on the economy has been validated time and again. Before the crisis, she saw the bubble for what it was and predicted disaster in the banking system," the California Democrat said in a press release. "When the crisis actually happened, she advocated for the urgent need to implement financial reform quickly in order to avoid another meltdown, which was vitally important to staunch the bleeding."

But many Republicans still opposed her due to her support for the Fed's current monetary policy.

"My concerns about the Fed's easy money policies and inflation led me to vote against Chairman Bernanke in his second term at the Fed," said Sen. Charles Grassley, R-Iowa, on the Senate floor. "Because it appears that Ms. Yellen will continue to pursue these misguided policies, I cannot in good conscience vote in favor of her confirmation."

Others, like Jeb Hensarling, R-Texas, chairman of the House Financial Services Committee, urged Yellen to bring even further transparency to the central bank in its approach to monetary policy.

"Dr. Yellen has spoken favorably about such a rules-based policy in the past, saying it is what 'sensible central banks do,' " said Hensarling in a press release. "It is important for the Federal Reserve to operate in the most transparent, predictable manner it possibly can to better serve the American people, and our committee has an obligation to carefully scrutinize the Federal Reserve's decisions and the way it communicates those decisions to the American people. 

Financial trade groups, meanwhile, lauded the Senate's vote.

"Chairman Yellen's expertise and leadership will be vital as the U.S. navigates the unwinding of the extraordinary policy measures taken by the Federal Reserve in response to the financial crisis," said Rob Nichols, president and CEO of the Financial Services Forum, in a press release.

Given her previous roles, Yellen is expected to take a more hands-on role in bank regulation than her predecessors. For the first time since Volcker, she will come to the job with significant bank regulatory experience. She has been credited with identifying looming threats prior to the financial crisis.

Yellen, 67, has largely kept mum on regulatory issues in her public remarks and has stuck to the consensus view by the Fed that breaking up the largest banks would not be the right solution to ending "too big to fail." She has also endorsed myriad ideas floated by her colleague, Fed. Gov. Daniel Tarullo, who heads bank supervision at the Fed.

At her confirmation hearing, she offered a few more clues on her views. She endorsed toughening up Basel III standards for the largest U.S. financial institutions through a capital surcharge and a supplemental leverage ratio.

Still, she refrained from elaborating how much stricter measures like the supplemental leverage ratio should be, opting to take a wait-and-see approach like Bernanke.

Yellen has also stressed the importance of eradicating "too big to fail," naming it one of the most important goals of the post-crisis period.

"That must be the goal we try to achieve," Yellen said at the November hearing. " 'Too big to fail' is damaging. It creates moral hazard. It corrodes market discipline. It creates a threat to financial stability, and it does unfairly, in my view, advantage large banking firms over small ones."

Like her counterparts at the Fed, Yellen was clear that she recognized the importance of not overburdening community banks with new regulatory laws.

The former University of California Berkeley economist will also have to steward the Fed's unprecedented quantitative easing program under her tenure.

The Fed agreed under Bernanke's chairmanship to begin tapering its purchases of Treasury and mortgage-backed debt to a pace of $75 billion a month from $85 billion a month in December given new economic data.

In his last major speech, Bernanke explained the Fed's decision to "modestly reduce the pace of asset purchases at its December meeting did not indicate any diminution of its commitment to maintain a highly accommodative monetary policy for as long as needed. It reflected the progress we have made toward our goal of substantial improvement in the labor market outlook."

Yellen, who has voted with Bernanke in favor of the Fed's monetary policy actions, will become chief communicator in explaining the steps the bank plans to take using a tool called forward guidance to financial markets and the public.

As chairman, Bernanke has repeatedly tried to send the message — even as recently as a press conference following the Federal Open Market Committee's December meeting — that the Fed's asset purchases were "not a preset course" and would be dependent on the Fed's assessment of economic data.

He's also repeatedly stressed that the federal funds rate would likely remain near zero for a "considerable time" even when the Fed begins to taper its asset purchases and well after the unemployment threshold of 6.5% is crossed.

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