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Jay Powell has defended the Authority of the Federal Reserve on the CHEMATION policy of the US
The Fed is facing the harshest challenge for its independence to set interest rates since the 1980s, with Donald Trump claimed during his first week in the White House that he understood monetary politics better than the Central Bank. Trump has also said that borrowing costs should be lower.
Fed Powell chairman told lawmakers in the Senate Banking Committee on Tuesday that the Central Bank was a better chance of keeping prices under control if it remained on quarrel – and it was on the other hand to continue its work to set the rates of interest without politics by intervention policy
“We will make better policy, we will keep inflation lower, if we simply focus on doing our job and stay out of politics, stay out of elections, and not try to favor or hurt any political party, or any Political Filter and just try to focus on the data, ”Powell said in his first appearance before the influential committee since Trump returned to the Presidency. “If we start putting political filters, we will be less effective in our already difficult work.”
Powell was convinced that every Trump’s decision to remove one of the seven members of the Fed Governors Board was “quite clearly not allowed by law”.
The remarks come as some Democrats are concerned that the Fed is already responding to Republican pressure.
Democratic senators at the session mentioned FED plans to review rules on so -called stress tests for the country’s largest banks, removing his main supervisor Michael Barr from that role and his decision to leave the network to green the financial system such as Evidence that it was undergoing Republican attacks.
However, Powell made it clear on Tuesday that when it came to monetary policy, the Fed would not respond to pressure from the new administration and lawmakers on both sides of the line to reduce interest rates quickly.
The chairman of the Fed reiterated that strong growth means that the rate determinants were not “in a hurry” to reduce the costs of borrowing lower than their current level between 4.25 percent and 4.5 percent.
At a session dominated by Democrats’ concerns about the Gutting of the Trump administration of the Consumer Financial Protection Bureau and claims Republicans that many of the rights backed by rights are being debited due to their political tendencies, Powell refused to withdraw from those who The economic consequences of the President of the President may be actions.
“It really remains to be seen which tariff policies would be implemented. It would be wise to speculate when we really don’t know. We see proposals, but it’s so hard to say what will happen,” Powell said . “In fact they are not just fees. Tariffs are politics, immigration, fiscal policies and regulatory policies. We will try to understand it and do what is suitable for monetary policy. “
John Williams, New York Fed President, also Tuesday signaled Setters norms will have to wait and see how economic conditions evolved before deciding whether to lower the norms.
While borrowing costs were still “modest restrictive”, Williams said the perspective was “very unsafe, especially about possible fiscal, trade, immigration and regulatory policies”.
