Fed Member Quits; Reagan to Get Majority

Federal Reserve Board member Lyle Gramley announced his resignation today, allowing President Reagan next year to appoint a majority of the central bank board for the first time.

Gramley, a powerful ally of Chairman Paul Volcker on the seven-member board, is leaving to become a senior executive and chief economist for the Mortgage Bankers Assn., representing about 2,200 mortgage companies, commercial banks, savings and loan associations, life insurance companies and others in the mortgage lending field.

Gramley, appointed by President Jimmy Carter in 1980, has been a strong voice on behalf of restraining money growth in order to bring inflation under control.

He has sometimes favored tighter credit even than Volcker and was the lone board member to oppose an interest rate cut last December.

Two Reagan Appointments

With Gramley’s departure, effective Sept. 1, the way will be cleared for Reagan to appoint two more people to the board after January.

The term of another board member, Charles Partee, runs out at the beginning of the year.

Reagan’s two appointees so far, Preston Martin and Martha Seger, have taken issue with the “tight money” stance supported by Volcker and Gramley.

Many Wall Street experts attach deep ideological significance to the erosion of the former majority, saying it will prompt expectations that inflation will be allowed to grow stronger and thus have profound effects on interest rates and stock and bond prices.