Yellen nomination to lead Federal Reserve gains in Senate

WASHINGTON -- Janet Yellen, an advocate of the Federal Reserve's aggressive steps to boost the economy, Friday took a big step toward becoming the first woman to chair the central bank as her Senate confirmation cleared a Republican procedural hurdle.

The Democrat-led Senate voted 59-34 to move forward with the nomination, indicating ample support for her confirmation. A final vote is set for Jan. 6 after a holiday recess.

If approved, as widely expected, the Fed's current vice chair would succeed Ben Bernanke, whose second four-year term expires on Jan. 31.

Yellen's main task would likely be unwinding the extraordinary stimulus put in place during Bernanke's watch.

"Hopefully she charts us back to something more familiar," said Robert Albertson, chief strategist at Sandler O'Neill + Partners LP in New York. "The Fed should not be in the position of constantly having to solve all the economic issues."

In the test vote, Yellen won unanimous support from Democrats. All but five Republicans on hand voted against taking up the nomination -- a sign of both unease with the central bank's policies and anger at a recent Senate rule change that made it easier for majority Democrats to end filibusters.

Yellen, 67, has been a strong supporter of the unprecedented and controversial monetary policies that Bernanke championed to spur investment, hiring and economic growth.

The central bank cut overnight interest rates to near zero in late 2008 and has quadrupled its balance sheet to about $4 trillion through a series of massive bond purchases meant to push down longer-term borrowing costs.

A strong believer that monetary policy can help get more Americans back to work, Yellen told a Senate hearing last month that efforts to boost hiring were an "imperative" for the central bank.

Yet, with the unemployment rate having fallen to a five-year low of 7 percent last month, her main task is likely to be unwinding the extraordinary stimulus the Fed put in place to climb out of the recession. The trick will be ending the bond purchases without rattling financial markets or disrupting a U.S. economic recovery.