Fed chief reasserts independence in talks with Trump

Andrew Cummings
November 19, 2019

That compares with the three times his predecessor, Janet Yellen, met President Barack Obama at the White House; Yellen also met Trump during her final year as Fed chair.

The Fed said in a statement that the three discussed the economy, growth, employment, and inflation at the White House meeting, but stressed its commitment to independence from political influence.

Trump has publicly raged against Powell and the Fed for months, complaining about its rate increases during 2018 and continuing to pound the central bank this year even as it has cut rates to keep a record U.S. expansion on track, as the president seeks to deflect blame for slowing growth that many have pinned on his trade war with China.

The meeting was first disclosed by Powell in a press statement, revealing he attended the meeting with Trump and Treasury Secretary Steven Mnuchin "at the president's invitation".

"Everything was discussed including interest rates, negative interest, low inflation, easing, Dollar strength & its effect on manufacturing, trade with China, E.U".

Meetings between Fed chairs and presidents are not unprecedented but they are infrequent, as opposed to the almost weekly sessions that central bankers have with the head of the Treasury.

President Donald Trump said he "protested" United States interest rates that he considers too high relative to other developed countries in a meeting on Monday with Federal Reserve Chairman Jerome Powell.

Fed chairs are appointed to four-year phrases by the president, however as soon as confirmed by the Senate are meant to be insulated from White Home political stress over the way to handle financial coverage.

In a speech last week, Trump said, referring to negative interest, "Give me some of that". "It puts us at an economic disadvantage".

They can only be removed "for cause", not over a disagreement over policy.

Less than 24 hours after that decision, Trump laid into Powell again, saying people were "VERY disappointed" in him and the Fed.

The president also said the GDP and stock market would be "much higher" if the Fed had not "wrongly raised interest rates".

The new report found that borrowing by businesses is at historically high levels relative to the size of the economy, with the most rapid increases in debt concentrated among the riskiest companies with the weakest credit standards.

But, after the most recent cut, Powell said last month the central bank will hold its fire for now as officials wait to see how the economy progresses.

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