Trump critical of Fed interest-rate rises

ZEKE MILLER, JOSH BOAK AND KEN THOMAS

WASHINGTON — President Donald Trump on Thursday cast aside concerns about the Federal Reserve’s independence, saying he was “not happy” with the Fed’s recent interest rate increases.

Trump told CNBC in an interview: “I don’t like all of this work that we’re putting into the economy and then I see rates going up.”

Last month, the Fed raised its benchmark rate for a second time this year and projected two more increases in 2018. Its rate increases are meant to prevent the economy from overheating and igniting high inflation. But rate increases also make borrowing costlier for households and companies, and risk weakening growth. The Fed’s most recent rate increases could dilute some of the benefit of the tax cuts Trump signed into law last year.

The president acknowledged that his comments about the Fed would likely arouse concerns. The central bank has long been seen as needing to operate free of political pressure.

The Fed’s dual mandate is to maximize employment and stabilize prices. By maintaining its independence, the central bank can make politically contentious decisions to combat economic challenges, like the huge bond purchases it made after the 2008 financial crisis to help drive down long-term rates to support the economy.

Early this year, Trump selected Jerome Powell as Fed chairman. Last week, Powell said in an interview with the radio show Marketplace that he didn’t expect to face any White House pressure.“We have a long tradition here of conducting policy in a particular way, and that way is independent of all political concerns,” Powell said. “We do our work in a strictly nonpolitical way, based on deobviously tailed analysis, which we put on the record transparently.”

He added, “No one in the administration has said anything to me that really gives me concern on this front.”

After Trump’s interview with CNBC was made public, Lindsay Walters, a White House spokesman, said the president “respects the independence of the Fed.”

“The president’s views on interest rates are well-known, and his comments today are a reiteration of those long-held positions, and public comments,” Walters said.