New US Federal Reserve boss Janet Yellen has certainly made an impact – on Australian Treasurer Joe Hockey.
“It appears to me that Dr Yellen is exactly the right person at the right time for the US Fed,” Mr Hockey told reporters in Sydney ahead of Sunday’s Group of 20 finance ministers meeting.
“Dr Yellen is a very impressive person, very impressive person.”
The Federal Reserve has been criticised over the international impact of the winding back of its economic stimulus program, known as tapering.
Since the Fed started tapering late last year there has been large outflows of capital from developing nations which has caused their currencies to fall dramatically.
G20 members Mexico and Brazil, as well as G20 outsiders Indonesia and South Africa, have called on the US to provide more clarity on its tapering strategy and better communication to offset the impacts on emerging markets.
Mr Hockey was asked about how Dr Yellen had explained the Fed’s tapering strategy to the G20 finance ministers and central bank governors at the Sydney meeting.
“At a time when there are sensitivities associated with tapering, I think her handling of it is superb,” he said.
“There was extensive discussion on the impact of tapering on emerging economies and it was an excellent discussion all round and we’ll have more to say about that in the communique.”
The Fed had been purchasing $US85 billion ($A94.5 billion) of government bonds from commercial banks each month to encourage lending and stimulate US growth.
The program has now been scaled back to $US65 billion ($A72 billion) a month.
The members of the Fed’s policy-making committee have expressed a desire to keep tapering going, as long as the US economy continues to improve.