No Talk of Ousting Fed’s Chairman Jerome Powell Despite Trump’s Criticisms, White House Adviser Says

November 2, 2019 Updated: November 2, 2019

There has been no discussion of having U.S. Federal Reserve Chairman Jerome Powell step down from his position, White House economic adviser Larry Kudlow told reporters on Friday after the Federal Reserve cut interest rates this week.

U.S. President Donald Trump “has been outspoken in his views about the Fed chairman,” said Kudlow, the director of the National Economic Council. But “there is no conversation to get rid of [Powell] whatsoever,” he said.

larry kudlow
Larry Kudlow, Director of the National Economic Council, speaks to the press at the White House in Washington on Oct. 5, 2018. (Nicholas Kamm/AFP via Getty Images)

He noted that the Fed has “changed their direction” in its monetary policy, and that “monetary policy is in a much better direction now.”

Trump has expressed disappointment in Powell repeatedly, and also criticized the central bank’s latest cut on short-term interest rates on Oct. 30—the third cut this year.

“People are VERY disappointed in Jay Powell and the Federal Reserve. The Fed has called it wrong from the beginning, too fast, too slow,” Trump wrote on Twitter on Oct. 31. “They even tightened in the beginning. Others are running circles around them and laughing all the way to the bank.”

“Dollar & Rates are hurting our manufacturers. We should have lower interest rates than Germany, Japan and all others,” he added, alluding to how central banks in Europe and Japan have shifted their rates into negative territory.

“We are now, by far, the biggest and strongest Country, but the Fed puts us at a competitive disadvantage. China is not our problem, the Federal Reserve is! We will win anyway,” Trump wrote.

The Fed’s move on Oct. 30 reduces the short-term rate it controls—also referred to as the federal funds rate—to a range between 1.5 percent and 1.75 percent.

The federal funds rate is a benchmark that influences many consumer and business loans, including mortgages, auto loans, and student loans.

By lowering the cost of borrowing, lower interest rates are intended to stimulate the economy by encouraging more borrowing and spending.

The Federal Reserve has signaled that it plans no further cuts unless it sees clear evidence that the economic outlook has worsened.

Powell said at a press conference on Oct. 30 that the committee believed “monetary policy is in a good place.”

“Of course, if developments emerge that cause a material reassessment of our outlook, we would respond accordingly. [The] policy is not on a preset course,” he said.

He noted that the weakness in global growth, trade tensions, as well as “muted inflation pressures” have led the Fed to lower rates.

Emel Akan, Reuters, and The Associated Press contributed to this report.

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