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President Donald Trump is stepping up pressure on the US Federal Reserve. In an interview with the paper, he again strongly criticized Fed Chairman Jerome Powell.
Trump suggests that it is hurting the US economy with interest rate hikes. "I do business and I do not get support from the Fed," said the Washington Post president. The central bank made a mistake. That's what his instinct tells him. "Sometimes my stomach says more than the brain of someone else could tell me."
With the boom of the economy, the Fed has gradually increased interest rates since early 2017 to keep inflation at a moderate level. It wants to fulfill its mandate to promote full employment and stable prices. The central bank is independent and therefore not subject to the government.
Powell pointed to the Fed's independence from Trump's multiple attacks. After the recent rate hike at the end of September, he said monetary policy decisions were not influenced by "political or other factors".
Personal Attack
The Fed wants to avoid overheating the economy after the government's drastic tax cuts. The president, however, fears a slowdown in the economy. He is also embarrbaded by rising interest rates, which makes it difficult for the government to finance growing budget deficits.
Trump repeatedly attacked the Fed violently and adopted a pejorative tone that was previously quite unusual for American presidents. He called the central bank, among other things, his "greatest threat", "his folly" and his "ridiculous".
Once again, Trump personally attacked Powell, whom he had named a little over a year ago: "Up to now, my choice of Jay does not even make me a little bit happy, I do not blame anyone, but I tell you, I think the Fed what she's doing is completely wrong. "
Despite Trump's criticism, the Fed faces years of pressure from Congress to increase transparency. Now it has an effect: Powell is in the process of reviewing the central bank and considering reforms, he announced recently.
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