Trump's Fed feud roils markets, alarms Republicans
Trump's intensifying attacks on Federal Reserve Chairman Jerome Powell are having a destabilizing effect on financial markets and rattling Republican lawmakers.
Trump's criticisms of the central bank’s chief policymaker kicked into high gear Monday, not long after Treasury Secretary Steven Mnuchin tried to reassure markets by insisting Trump has no intention of firing Powell.
Trump has undercut that claim by blaming the Fed for market volatility and recent economic woes.
The Dow Jones Industrial Average plunged 653 points on Monday in the worst day-before-Christmas stock performance in history as Trump renewed his attack on the Fed for raising interest rates last week. The S&P entered a bear market and is now down more than 20 percent from its August peak.
Economic experts say Trump is having a destabilizing effect on markets, and GOP lawmakers have publicly urged him to tread more carefully in his public remarks about the Fed, an independent institution.
Vin Weber, a former economic adviser to Mitt Romney’s 2012 presidential campaign, warned against taking drastic measures, saying firing Powell would provoke a “very bad” reaction.
“People, regardless of their views on monetary policy, would view that as an assault on the independence of the Fed and it would shake confidence considerably,” he said Monday.
Trump’s attempts to influence monetary policy, Weber said, are likely to backfire because they will only make the Fed’s job more difficult as it tries to maintain its credibility and independence.
https://thehill.com/policy/finance/422791-trumps-fed-feud-roils-markets-alarms-republicans?userid=229233
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