Janet Yellen says Trump does not understand what the Federal Reserve is doing

Washington – Former US Federal Reserve Chairman Janet Yellen said she doubted President Donald Trump's understanding of monetary policy and what the central bank is doing.

In an interview given to the Marketplace radio show, aired on Monday, Yellen said: "I doubt that he can even assert that the Fed's goals are a maximum of employment and stability of price".

Mr. Trump's comments demonstrate a "lack of understanding" of the Fed, she added.

In the interview published on Monday, Yellen made his sharpest comments on Mr. Trump since he decided not to nominate her for a second term as head of the Fed. She left the Fed a year ago and Jerome Powell took over as president.

Trump commented "that the Fed has an exchange rate target to support its commercial projects, or possibly target the US trade balance," Yellen told Marketplace. "And, you know, I think such comments show a lack of understanding of the Fed's impact on the economy and appropriate policy objectives."

When asked if she thought the president was good at managing the economy, she replied, "No, I do not have it."

Yellen, who is now a prominent colleague in residence at the Brookings Institution in Washington, also said that President Trump's very open criticism of the Fed could undermine the credibility of the central bank.

"President Trump's comments on President Powell and the Fed are worrying, because if it worked out, I think it would have an impact, especially if the situation in the US deteriorated for whatever reason," he said. could undermine confidence in the Fed, "she said. "And I think it would be a bad thing."

Last year, Trump repeatedly attacked Fed officials for raising interest rates, accusing them of curbing economic growth and "maybe" regrets choosing Powell as head of the Fed.