U.S. President Donald Trump's attacks on the Federal Reserve have broken on...
WASHINGTON - U.S. President Donald Trump’s attacks on the Federal Reserve have broken one set of precedents, his talk of stacking the central bank with political allies has strained another, and his on-again off-again tariff threats have made the economic outlook harder than ever to predict.
“There is a kind of feed the beast aspect to it,” said former Fed vice chair Alan Blinder. “Among the many things the Fed has to take as given is trade policy. And if in fact trade policy is going to push the economy into a slump, that is a reason to cut interest rates ... If the Fed comes in to bail him out you encourage bad behavior.”
“Our Fed is very destructive to us... They haven’t listened to me,” Trump said in a CNBC interview. “They’re not my people.” Earlier this year, Trump threatened a fuller assault by considering the appointment of two highly partisan political allies to the central bank, straying from a tradition of more technocratic appointments.
“We take all kinds of things...into account,” St. Louis Fed President James Bullard said last week before Trump called off the Mexican tariffs. “There are some good policies in there. There may be some bad policies in there. But we have to take everything into account.”Recent economic data are already complicating the Fed’s job. Policymakers have expected the economy to slow, but also regarded the likely slowing as modest, and not enough to warrant a rate cut.
Rolling with the punches from political Washington is nothing new. Former Fed chair Ben Bernanke complained when congressional spending caps reduced economic growth just as the U.S. recovery was getting traction and the eurozone was threatening to crack apart.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
The Fed Should Ignore Trump and Contemplate Cuts for the Right ReasonsAt a time when the need for easier money is debatable, it would be natural for monetary policy makers to snub President Trump’s calls for interest-rate cuts to prove their impartiality. But it would be a mistake.
Read more »
Here's Goldman Sachs playbook for beating the market if the Fed cuts interest ratesGoldman Sachs is encouraging their clients to prepare for the possibility that the Federal Reserve cuts interest rates later this year.
Read more »
‘Not My People’—Trump Hectoring of Fed Chairman Complicates Rate CallsRepeated criticisms from the president are part of the context in which Jerome Powell must decide whether threats to the economy, including from trade fights, dictate an interest-rate cut soon.
Read more »
How baseball's new quant strategies could inform the Fed's next rate-cut callThe Fed seems to be contemplating a pre-emptive easing move, or using its most potent weapon earlier in the 'game.'
Read more »
Bets on Falling Interest Rates Unleash Gold RallyGold is on its longest winning streak in almost a year and a half, the latest signal that investors are preparing for the Fed to lower interest rates amid signs of a slowdown in economic growth.
Read more »
This big Wall Street bear warns his bleak scenario for 2019 is taking shapeLast week, tariffs on Mexico increased the chances that the Fed would cut rates. Investors obviously like that. So, stocks rallied. This week, Trump backs...
Read more »