US Fed chief Jerome Powell says he expects good relations with Trump administration
Sign up now: Get ST's newsletters delivered to your inbox
The Fed chair also said he and his colleagues can afford to be cautious as they lower Interest rates.
PHOTO: AFP
Follow topic:
Washington - US Federal Reserve chairman Jerome Powell said he is confident he will have a similar relationship with the incoming administration, including Treasury nominee Scott Bessent, as he has now.
“I fully expect that we’ll have the same general kinds of relationships, institutional relationships, for example with the Council of Economic Advisers, but most importantly with the Treasury Department,” Mr Powell said on Dec 4 at the New York Times DealBook Summit in New York.
Of Mr Bessent, Mr Powell said he was “confident that I will have the same kind of relationship with him once he’s confirmed as I’ve had with other Treasury secretaries”.
Mr Bessent has backed the idea of nominating a “shadow Fed chair” well in advance of the end of Mr Powell’s term in 2026, a move that would effectively undermine the Fed leader’s influence with financial markets.
Mr Powell said he did not believe the incoming administration would pursue that idea. “I don’t think that’s on the table at all,” he said.
On monetary policy, the Fed chairman said he and his colleagues can afford to be cautious as they lower rates towards a neutral level – one that neither stimulates nor holds back the economy. The Fed will issue its next policy decision after its Dec 17 to 18 meeting.
Mr Powell added that US inflation is still not quite back to the central bank’s 2 per cent target,
The Fed’s preferred measure of underlying inflation accelerated in October to its highest monthly reading since March, offering support for a cautious approach to further reductions.
Mr Powell in November described the US labour market as solid and said the overall economy was not signalling that policymakers needed to hurry in lowering rates.
A labour market report due on Dec 6 is expected to show hiring picked up and the unemployment rate held steady in November, according to a Bloomberg survey of economists. BLOOMBERG
