U.S. President Donald Trump has accelerated his efforts to strengthen his grip on the Federal Reserve, especially following Chairman Jerome Powell’s indication of a possible interest rate cut. Last month, Powell suggested at the Jackson Hole Symposium that the likelihood of a rate reduction in September had increased, intensifying market expectations. On the same day, Trump threatened to remove Federal Reserve Governor Christopher Waller and subsequently dismissed him from his position. Waller deemed the removal unfair, refused to resign, and later initiated legal action against Trump. A Federal Reserve spokesperson confirmed that Waller would continue his duties as governor while the matter is under judicial review.
Trump is also working to increase the number of his supported members on the Federal Reserve Board, including proposals to appoint current interim governor Michael Barr to a permanent position. Additionally, the administration has focused on the selection process of regional Federal Reserve presidents to expand its political influence. This week, the U.S. Senate Banking Committee is scheduled to hold confirmation hearings for Barr, Trump’s nominee for the Federal Reserve Board. Furthermore, the director of the Federal Housing Finance Agency will provide updates on a significant lawsuit involving Governor Waller.
These tensions could impact U.S. monetary policy, particularly as the global economy faces uncertainty and central bank decisions gain critical importance. Trump’s moves may further spark debate over the balance between financial independence and political influence.
Source: binance
