Trump suggests political motivations behind Powell’s Fed decisions and points to threat of ‘massive new inflation’

Former president Donald Trump on Friday he shared his thoughts on the nation’s economic direction and criticized the Federal Reserve chairman Jerome Powell’s command.

In an interview with Maria BartiromoTrump has expressed his apprehensions about Powell, suggesting a political slant in his decision-making, especially regarding interest rate policies.

“I think it’s political,” Trump said, adding that he believes Powell’s actions could benefit the Democratic Party.

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Highlighting the potential for inflation due to rising tensions in the Middle East impacting oil prices, Trump doubted Powell’s ability to handle such economic challenges. “But there is the potential to have massive inflation again, because the Middle East could drive up the price of energy,” Trump said, according to Fox Business.

Despite originally nominating Powell in 2018, Trump has indicated a change in Federal Reserve leadership if he were to assume the presidency again, stating, “No, I wouldn’t,” when asked about renominating Powell.

The Fed’s strategy has led to a significant tightening of monetary policy, with rates rising from near zero to over 5% in a relatively short period. This has resulted in higher financing costs for both consumers and businesses, impacting the wider economy.

Trump also attributed the stock market’s recent bullish trends to his political outlook, suggesting that investor optimism about his potential return to office is driving the market’s gains, Fox Business reported. “They think I’m going to get elected,” Trump added, linking market performance to his political fortunes.

Now read: Japan reportedly stepped up efforts to convey to Trump concerns over deals with China that could destabilize Asia

This content was partially produced with the help of artificial intelligence tools and was reviewed and published by Benzinga editors.

Photo: Shutterstock

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