Fri, 25 Apr 2025

Fri, 25 Apr 2025 Why Trump keeps attacking the US central bank

The US central bank is one of Trump's favourite punching bags. But how serious is the threat?

*Trump later denies any intention to fire Powell, but maintains his right to have a view on the Fed's interest rate policy
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*Economists warn that Trump's pressure on the Fed could undermine confidence in its independence and lead to higher borrowing costs
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*Trump's critics point to parallels with former President Nixon's attempts to influence the Fed, which contributed to high inflation and economic stagnation
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*Powell maintains he is unbothered by Trump's criticism, but his position may be vulnerable to legal challenge if the administration pushes for his removal
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*Trump's actions have raised concerns about the potential for presidential interference in the Fed, with some economists warning of a "pernicious effect" on market confidence
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*The White House has taken steps to reduce the Fed's regulatory role and is engaged in a legal battle over expanding presidential authority over other government agencies
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