(AFP) – US President Donald Trump on Thursday stepped up the pressure on Federal Reserve chair Jerome Powell to cut interest rates, in their first sit-down since the Republican returned to the White House in January. Trump has in recent months trained his fire on the Fed chair — whom he first nominated to lead the independent central bank back in 2017 — accusing him of being “too slow” to cut rates to boost economic growth.
Powell and his colleagues on the Fed’s rate-setting committee have insisted they will only cut rates from current levels when economic conditions allow. Trump told Powell that he was “making a mistake by not lowering interest rates,” White House Press Secretary Karoline Leavitt told a press briefing after the meeting. Trump also said in the meeting that holding interest rates high was putting the United States at an “economic disadvantage” to other countries, including China, Leavitt said.
Earlier Thursday, the Fed said Powell had defended US central bank independence over interest rates during the unusual meeting, which Trump had called to discuss “economic developments including for growth, employment, and inflation.” “Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook,” the Fed said in a statement.
Powell said the Fed’s rate-setting committee would make its decisions “based solely on careful, objective, and non-political analysis,” it added. The meeting, the first since Trump began his second term, marks a ratcheting up of the pressure on Powell following the president’s frequent social media posts criticizing him for moving too slowly to cut rates — a process that stokes both growth and inflation. Trump and Powell met on several occasions during the president’s first term in office.
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