Business

Leading Fed chief candidate bows out

Larry Summers is out of the running to lead the Federal Reserve, a surprise blow to President Obama, who had pushed hard for his appointment.

Summers, who had been blasted by critics as an architect of policies that led to the Great Recession, cited in a letter to Obama the controversy over his candidacy.

“I have reluctantly concluded that any possible confirmation process for me would be acrimonious,” wrote Summers, who early in the Obama administration had served as chairman of the National Economic Council.

In addition to some Senate Democrats who had vowed to block his appointment, Summers faced opposition from women’s groups over allegedly sexist comments he had made several years ago that got him ousted as Harvard’s president.

In a statement, Obama said he accepted the decision. He still praised Summers for helping avert a depression after the start of the banking crisis.

Beltway insiders said the bow-out by the gruff Harvard economist is the latest sign that Obama’s sway is waning generally as he scrambles to find the right policy to confront Syria.

“Basically the view is that Obama is losing traction in Washington,” one insider told The Post. “He pushed very hard for Summers but opposition was too significant.”

The surprise move forces Obama to weigh other contenders he has interviewed, including Janet Yellen, the Fed’s vice chairwoman; and Donald Kohn, a former vice chairman.

Yellen, who has won strong support from many of Summers’ critics, is nevertheless “not much different from Summers on policy,” according to a Washington source.

Current Fed chief Ben Bernanke, whose term is up Jan. 31, has signaled he isn’t interested in staying on.