Trump Rages at the Fed Over Interest Rates
President Donald Trump is not happy with Federal Reserve Chair Jerome Powell. Airing his grievances over the weekend on Truth Social, the president complained that interest rates have not been lowered recently and accused the Fed, led by Powell, of lowering interest rates before the election “in order to help” Kamala Harris “get elected.”
In the financial community, it’s kind of an open secret that the Fed was politically motivated to ease monetary policy. Christopher Waller, a member of the Federal Reserve Board of Governors, laid the groundwork for the cuts in a speech in December 2023, and all that was needed was a short run of soft economic data to pull the trigger on the rate cuts, which began with a half percentage point cut followed by two quarter-point cuts. Lowering the interest rate had the desired effect—fluffing up the stock market before the election—but the thumb on the scale was not enough to tip the election in Harris’ favor.
Politics often influences monetary policy decisions, despite the Fed’s nominal independence. It should also be noted that the stock market is experiencing volatility comparable to what happened during the pandemic, when interest rates were cut to zero and the Fed engaged in quantitative easing. Durin
Article from Reason.com
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