Former US President Donald Trump has openly criticised Federal Reserve Chair Jerome Powell, suggesting he would take action against him if interest rates were lowered before the 2024 election. Trump, who appointed Powell in 2017, accused the Fed of political bias, claiming rate cuts could unfairly benefit President Joe Biden's re-election campaign.
Trump's Warning to the Fed
In a recent interview, Trump stated, "If he lowers rates, it could be seen as helping the Democrats. I would have a right to do something about it." While he did not specify what actions he might take, his comments have raised concerns about political interference in the traditionally independent Federal Reserve.
Economic and Political Fallout
Analysts warn that Trump's remarks could undermine confidence in the Fed's impartiality. "The Fed's credibility relies on its independence from political pressure," said one economist. "Threats like these are dangerous for market stability."
Meanwhile, the Biden campaign dismissed Trump's claims as baseless, emphasising that the Fed operates independently of the White House.
What This Means for 2024
With inflation still a key issue for voters, the Fed's decisions on interest rates could significantly impact the election. Powell has previously stated that the Fed's policies are data-driven, not politically motivated. However, Trump's latest comments add fuel to an already heated debate over monetary policy and electoral fairness.
