Donald Trump said the future chair of the Federal Reserve should consult him directly on interest-rate decisions, signaling a desire for closer presidential influence over monetary policy. He stated that borrowing costs should fall to 1% or lower within the next year.
Trump indicated he is considering Kevin Warsh or Kevin Hassett to lead the central bank. Both are viewed as more aligned with looser monetary conditions compared with the Fed’s current leadership approach.
The comments raise questions about the future independence of the Federal Reserve. Markets closely monitor any political pressure on rate policy, as expectations around lower rates can significantly affect currencies, bonds, and equity valuations.
