Trump Won’t Acknowledge the Independence of the Fed

Drew Angerer  Getty Images President Donald Trump and Federal Reserve Chair Jerome Powell

Drew Angerer Getty Images President Donald Trump and Federal Reserve Chair Jerome Powell

President Donald Trump continued to blast the Federal Reserve's recent interest rate hikes in an interview Monday, days after complaining about Federal Reserve Chairman at a private GOP fundraiser.

With analysts expecting another United States interest rate increase in September, there is a possibility of disappointment.

Key U.S. government debt yields slid to six-week lows on a flight to safety bid and the dollar slid further on Wednesday as investors weighed how a conviction and a guilty plea of former advisers will impact U.S. President Donald Trump.

Policymakers at the central bank have already voted to hike the benchmark federal funds rate twice this year, and are expected to do so twice more in 2018, bringing the yearly total to four.

In the middle of global trade disputes, Trump in an interview with Reuters also accused China and Europe of manipulating their respective currencies.

During the previous episode of Fed criticism, the White House maintained that Trump respected the central bank's independence.

The dollar, on the ascent in recent months thanks to Fed rate rises and a robust United States economy, stumbled after Trump's latest criticism of the central bank. "The other countries are accommodated", he told Reuters. The currency has declined against the us dollar for 10 straight weeks.

The preliminary talks "look unlikely to yield too much in the way of progress as they enter a second day, with the USA president, given his current political difficulties, unlikely to want to concede any further ground", said CMC Markets analyst Michael Hewson.

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In his interview, Trump accused the European Union and China of manipulating their currencies, adding that Beijing was weakening the yuan to offset the effects of USA tariffs.

Gold prices edged up on Friday after falling almost 1 per cent in the previous session, but expectations of higher US interest rates and a robust dollar amid the Sino-US trade war kept a lid on the market.

"We do our work in a strictly nonpolitical way, based on detailed analysis, which we put on the record transparently, and we don't take political considerations into account", Powell said in the interview. Now only three seats are filled.

Point Bridge Capital Founder Hal Lambert, IHT Wealth Management President Steve Dudash and Payne Capital Management President Ryan Payne on the report that President Trump isn't "thrilled" with Federal Reserve Chairman Jerome Powell for raising rates.

Powell will be joined by both current Fed governors, Lael Brainard and Randal Quarles, as well as Fed governor nominee Marvin Goodfriend. That leaves at least one other current opening for him to fill.

"Am I happy with my choice?"

"While inflation has recently moved up near 2 percent, we have seen no clear sign of an acceleration above 2 percent, and there does not seem to be an elevated risk of overheating", Powell said. "I'll let you know in seven years".

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