Federal Reserve Chairman Jerome Powell will likely face questioning from Senators about the Fed’s independence from political pressure, according to The Wall Street Journal.
The issue arose after Powell made comments suggesting interest rate cuts a few weeks after President Trump criticized Powell for keeping interest rates too high. Powell made remarks again today in front of the Senate Banking Committee that strongly suggested the Fed was planning to cut interest rates later this month.
He reiterated the Fed’s intention to “act as appropriate to sustain the expansion.” Investors have caused the stock market to reach new highs after taking the comments from Powell as a sign that interest rates will be cut. Rates will likely be cut at the next policy meeting on July 30-31.
Powell said on the first day of testimony on Capitol Hill that economic outlook has not improved significantly since the Fed’s June meeting. Despite a US-China truce in the trade war, slow global economic growth has caused people to call for rate cuts in order to boost the economy.