Federal Reserve chairman Jerome Powell is working to keep the U.S. out of a recession while being blamed by President Trump for an economic slowdown. So, while the Fed works to boost the economy, they are also working to keep the bank independent from political pressure according to The Wall Street Journal.
After cutting interest rates in July, the Fed seems to be moving toward more rate reductions. Inside the Fed there is debate concerning how much rates should move and how to justify moving them.
Although many blame the slowing market on Trump’s trade policies, Trump is blaming the central bank. The president maintains that the Fed moved interest rates too high last year.
“I think our economy is very, very good,” Mr. Trump said Sunday. “If it slowed down, it is because I have to take on China and some other countries.”
At the same time, Trump called Powell “clueless” when markets fell last week.
“He’s made clear in various interviews and tweets that he doesn’t believe that the Fed should be independent,” former Fed Chairwoman Janet Yellen said of the president.
The bank’s independence from politics is seen as a critical component of the economy. Last year, the Fed raised rates four times due to falling unemployment rates and inflation reaching the 2% target. Officials widely approved of the rate raises then.
Read the full story here.