Trump bashes Fed chief Powell in interview with Reuters

Marcus Newton
August 23, 2018

While many US presidents have chafed at the Fed's inclination to increase rates and curb inflation, few if any have been as outspoken as Trump in their criticisms of the USA central bank. Last month he allowed as how he wasn't "thrilled" about the interest rate hikes the Fed was undertaking under the stewardship of his appointee Jerome Powell, but said "I'm letting them do what they feel is best".

On Monday, Mr. Trump complained about the Fed chairman publicly, telling Reuters "I'm not thrilled with his raising of interest rates, no. I think on this one the market will come round again and the dollar bounces back, but nonetheless, it does appear the market is anxious that the president will exert influence on Fed policy".

Presidents have historically avoided commenting on Fed policies. Describing policy as "accommodative" would at some point "fairly soon", no longer be appropriate, the minutes said.

Since Trump took office, the Fed has raised rates five times, including twice this year under Powell.

The US President Donald Trump's critical comments on the Fed's policy tightening kept exerting downward pressure on the US Dollar and turned out to be one of the key factors driving the pair higher.

Trump since July has repeatedly criticised the Fed, an independent body that is not controlled by Congress or the president.

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According to Bloomberg, Trump complained that Powell - the president's own pick for the Fed's top job - was raising interest rates instead of delaying rate hikes and keeping monetary policy loose.

The Fed has been carefully and gradually raising rates over the past several years to keep inflation in check and to prevent the economy from overheating. "And I think the euro is being manipulated also", Trump said. "I'm not thrilled", said the president, who himself appointed Powell to lead the central bank.

"Am I happy with my choice?" In a confirmation hearing past year, shortly after Mr. Trump nominated him to the position, he told senators he expected the Fed to continue raising interest rates in the near term.

"We're going to do our business in a way that's strictly non-political, without taking political issues into consideration, and that carries out the mandate Congress has given us", he said.

The criticism comes after a private Republican fundraiser on Friday, during which Trump reportedly attacked Powell's interest-rate hikes. According to Board of Governor's meeting records released after each of these increases, Powell was fully in support of the policy put in place by Yellin back in December 2015 and that he has been a strong advocate for the modest interest rate increases that have taken place since he took office earlier this year.

Other reports by MaliBehiribAe

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