Dispute over interest rate
After Trump’s attack: ECB boss jumps on US Federal Researchers’ Bank
Donald Trump puts pressure on the head of the US Federal Reserve and demands interest rate cuts. The President of the European Central Bank will join him – and warns of great economic consequences.
After the attacks of Donald Trump on US Federal Research chief Jerome Powell, ECB President Christine Lagarde warns of political influence on monetary policy. Whenever there were political interference and whenever the boss or president of a central bank lost his independence, less economic growth and increased inflation were the result, Lagarde said directly at an event of the “Washington Post”, without mentioning Trump. “Nobody wants that, and certainly not the mission.”
“The talent and competence of the Fed chairman calm me down,” said the President of the European Central Bank. “And I know that he puts all his efforts and all his discipline in fulfilling his mission.” She has “great respect” in front of Powell, said Lagarde. He is doing exactly what he is expected to serve the American people and financial stability.
Trump does not want to relieve interest cuts, but not Fed boss
Trump’s massive criticism and reports of the US government’s considerations to dismiss Powell had recently triggered stock exchange turmoil. Trump has asked for an interest rate reduction several times and referred to Powell as “Mr. too late” and a “big loose”. Powell does not want to reduce interest risks after Trump’s customs circuit for the time being. Finally, Trump emphasized that he was not planning to release Powell. “I don’t intend to fire him,” said Trump when swearing in the new stock exchange supervisor Paul Atkins.
A US President cannot easily relieve the head of the central bank-Powell himself had clarified this in November, shortly after Trump won the presidential election.
Lagarde had jumped in Powell last week after the interest decision of the ECB Powell and described him as a “valued colleague and friend”.
dpa
Source: Stern
