John Williams, President of the New York Federal Reserve, emphasized the importance of the independence of the central bank on Wednesday when President Donald Trump wants to take control of monetary policy.
In a CNBC interview, the influential political decision -maker, who directly commented on Trump's efforts to enjoy the governor Lisa Cook, avoided the important economic role that the central bank plays when maintaining a stable economy.
“Personally, I worked with Lisa Cook when she was a member of the board of directors and she always brought integrity and commitment to the Mission of the Central Bank,” said Williams during the interview “Squawk Box”. “I think the independence of the Federal Reserve Central Bank is very important. … We know from history that independent central banks can provide low inflation, economic and financial stability.”
During the first year of his second term, Trump repeatedly thrown against the traditional barrier, which stood between the quasi-government fed and the influence of the White House and the Capitol Hill.
The President accused Fed Chairman Jerome Powell and his colleagues because he did not lower interest rates. Previously, he was played with the idea of ​​releasing Powell before finally deciding to take over Cook, who faces the allegations that she committed mortgage fraud before becoming a board member.
Williams said that the fight had to play before the dishes.
“The structure of the Federal Reserve is that it should have independent political decision -makers who make decisions; longer decisions influence the economy in the long term, apart from short -term political pressure,” he said. “I think that's really very, very important.”
With regard to the short -term instruction of politics, Williams said that it is likely that the Fed will reduce interest rates, but he had not made a schedule available for when this could happen. The markets strongly expect that the Federal Open Market Committee, in which Williams acts as deputy chairman and constant electoral member, will reduce the benchmark interest rate again in September after the essay of the year. The current FED fund interest rate is 4.25% to 4.50%.
Williams said that he generally considered the US economy to be strong, albeit a little, and described the labor market “solid”, a term that many of his colleagues have recently used.
“If things move as I hope that they do in relation to our maximum goals for employment and price stability goals, then I think it is appropriate to move the interest rates low over time,” he said. “But we have to be driven by the data.”
Last Friday, Powell said that he would expect the tariffs to fall, but also not specified a time frame.
