Former Obama economic advisor and Clinton treasury secretary Larry Summers, rumored to be the president's preferred candidate for the chairmanship of the Federal Reserve, has withdrawn his name from consideration for that post.

Politico:

Larry Summers on Sunday withdrew his name from consideration as chairman of the Federal Reserve, a defeat for President Barack Obama -- who could not convince members of his own party to shelve their opposition to his former top economic adviser.

Summers, who previously served as Treasury secretary in the Clinton administration, director of the National Economic Council and president of Harvard, notified President Barack Obama of his decision with a phone call Sunday morning.

"Larry was a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom, and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today," Obama said in a statement Sunday. "I will always be grateful to Larry for his tireless work and service on behalf of his country, and I look forward to continuing to seek his guidance and counsel in the future."

During their call, Summers told Obama he believed there was now too much political opposition to his nomination to move forward, a person familiar with the phone call said. Summers told Obama that his nomination now would create too much political uncertainty for the Fed and could thus be damaging to the economy. Obama accepted Summers' rationale and did not attempt to convince him to continue as a candidate for the Fed job, the person said.

Summers was a top initial candidate for the Fed job among senior current and former White House officials. Obama was also inclined to appoint Summers to the post, people close to the White House said. But the longer time dragged on without a nomination, the more liberal groups and some Democratic senators were able to organize to oppose Summers, who many on the left viewed as too close to Wall Street and not strong enough on financial regulation.