WASHINGTON - Bolstered by a White House lobbying effort, Federal Reserve Chairman Ben Bernanke's chances at a second four-year term improved Monday, calming a stock market that had grown anxious over the uncertainty of his support.
Senate Majority Leader Harry Reid (D-Nev.) expects a vote by the end of the week, his spokesman said yesterday. And David Axelrod, a top adviser to President Barack Obama, said Bernanke has the votes to keep his job.
The Federal Reserve, with its power to set interest rates that influence economic activity, employment and inflation, wields extraordinary influence over the lives of millions of Americans. It also plays a crucial role as the country's lender of last resort when banks can't get their money elsewhere.
Bernanke still can count on several "no" votes when the Senate takes up his confirmation, including Sen. John McCain (R-Ariz.), who Monday formally announced his opposition to the Fed chairman.
Sen. Joseph Lieberman, a Connecticut independent, joined Democratic Sens. Max Baucus of Montana, chairman of the Senate Finance Committee, and Dianne Feinstein of California in announcing support for Bernanke's reappointment. Others were quietly falling in line.
Bernanke's term expires Jan. 31. He and his Fed colleagues begin a two-day meeting Tuesday to gauge the strength of the economic recovery and weigh efforts to wean banks from emergency lending programs.
It is also expected to renew a pledge to hold rates at record lows for an "extended period" to nurture the recovery. Economists think that means rates will stay where they are for at least six more months.