2016-09-28bloomberg.com

Fed Governor Lael Brainard has donated to Clinton's campaign and is widely viewed as a potential Clinton pick for Treasury secretary. Yellen hesitated and then demurred when Representative Scott Garrett of New Jersey asked whether Brainard would have a conflict of interest if she were indeed in talks with Democratic nominee Hillary Clinton's campaign about a position. The election takes place Nov. 8.

"I would have to consult my counsel, I'm not aware that that's a conflict," Yellen said in testimony to the House Financial Services Committee in Washington, while rejecting Garrett's suggestion that the U.S. central bank has a political bias.

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The heated exchange came during a week when the Fed has been under fire for its politics: Republican Presidential nominee Donald Trump said that the Fed is keeping rates low to make President Barack Obama look good during a widely-viewed televised debate on Monday. Merited or not, the persistent questioning of the Fed's objectivity -- and Yellen's inability to deflect that skepticism -- could become a headache for the officially non-partisan and independent central bank.



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