President Obama Loses Key Economic Advisor

Posted June 7th, 2011 at 10:55 am (UTC-5)
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One of U.S. President Barack Obama's key economic advisors will leave the White House in a few months and return to teaching at the University of Chicago.

Mr. Obama calls Austan Goolsbee one of his “most trusted advisors” and a close friend who helped steer the country out of the worst economic crisis in decades.

The Wall Street Journal describes Goolsbee as more pragmatic and less liberal than some other presidential advisors.

In the meantime, investors and economists will be watching closely Tuesday as the head of the U.S. central bank assesses the economy and describes possible policy changes intended to boost growth and employment.

In a speech Tuesday afternoon, Federal Reserve Chairman Ben Bernanke may reveal if the bank will make more efforts to cut long-term interest rates. The Fed has just finished a round of purchases of financial assets to cut those rates in the hope it will make it easier for businesses to borrow the money they need to expand, buy equipment, and hire more people.

Investors will also listen for clues about the timing and size of any changes to short-term interest rates which have been at historic lows for some time.