WASHINGTON, Feb 5 — US President Donald Trump said Wednesday that he would not have picked former Federal Reserve official Kevin Warsh as the central bank’s next chief if Warsh were not in step with lowering interest rates.
In an interview with NBC News, he said Warsh understands that Trump wishes for him to cut rates.
“But I think he wants to anyway,” Trump added.
The president also said Warsh would not have been selected for the job if he sought to raise rates instead.
Trump has been vocal about his preferences for lower rates, criticising current Fed Chair Jerome Powell repeatedly for not reducing levels more aggressively.
In his NBC News interview, Trump said current interest rates are “way high.”
The Fed cut rates three times last year but held off on further reductions in January as policymakers walk a tightrope, balancing inflation risks alongside labor market worries.
Warsh could also face an uphill battle in his Senate confirmation process, amid growing concerns about the Fed’s independence from political pressure.
Republican Thom Tillis of the Senate Banking Committee recently vowed to oppose the confirmation of Fed nominees — including the next chairman — until a Justice Department probe against Powell is resolved.
Trump’s ongoing attempt to oust Fed Governor Lisa Cook, and his administration’s investigation into Powell over renovation costs at the bank, have sparked worries about the institution’s insulation from politics. — AFP
