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Jay Powell defended the authority of the Federal Reserve on American monetary policy, when he promised to “focus on data” and avoid walking in politics despite calls from the White House and some legislators to reduce loan costs.
THE Nourished Faced with the fiercest challenge for its independence to set interest rates since the 1980s, Donald Trump affirming in his first week in the White House, is faced with the monetary policy than the Central Bank. Trump also said borrowing costs should be lower.
Fed chair Powell The legislators told the Senate banking committee on Tuesday that the central bank had a better chance of keeping the prices under the control if it remained above the fray – and was in turn on the left to acquire its rate fixing work interest free of political interference.
“We are going to do better policy, we will maintain inflation below, if we simply focus on our work and stay outside of politics, will stay outside the elections and do not try to promote or harm a Political party, or any other filter and try to focus on the data, “Powell said during his first appearance in the influence since Trump returned to the presidency. “If we start to install political filters, we will be less effective in our already difficult work.”
Powell was categorical about the fact that any Trump decision to dismiss one of the seven members of the Fed Governors’ Council was “clearly not authorized by law”.
The remarks come when some Democrats fear that the Fed will already meet republican pressure.
The Democratic Senators of the Audience cited the Fed plans to review the rules on so -called stress tests for the biggest banks in the country, the departure of his chief supervisor Michael Barr and his decision to leave the network for the ‘Ecologization of the financial system as proof that he succumbed to republican attacks.
However, Powell clearly indicated Tuesday that, with regard to monetary policy, the Fed would not respond to the pressures of the new administration and legislators on both sides of the aisle to quickly reduce interest rates.
The president of the Fed reiterated that a strong growth meant that the rate regimes were “not in a hurry” to reduce borrowing costs lower than their current level between 4.25% and 4.5%.
In a hearing dominated by the concerns of Democrats concerning the elump elimination of the Consumer Financial Protection Office and that the Republican affirms that many right -wing Americans have landed because of their political trends, Powell refused to ‘Being supported on the economic consequences of the Presidency of the President The actions could be.
“It really remains to see what pricing policies would be implemented. It would be unlikely to speculate when we really don’t know. We see proposals, but it is so difficult to say what will happen, ”said Powell. “These are not only prices. These are prices, immigration, fiscal policy and regulatory policy. We will try to understand it and do what is good for monetary policy. »»
John Williams, president of the New York Fed, also on Tuesday that rate settings should wait and see how economic conditions have evolved before deciding to reduce rates.
While the borrowing costs were still “modestly restrictive”, Williams said that the prospects were “very uncertain, in particular around tax, commercial, immigration and potential regulation policies”.
