Published: Mon, March 25, 2019
Money | By Ethel Goodwin

Trump taps a strident Powell critic for spot on Fed board

Trump taps a strident Powell critic for spot on Fed board

Moore has told The Washington Post that he and the president have spoken about the Fed and that he felt Trump's other nominees to the Fed board were too conventional and did not understand the president's economic vision. But we would have been over four (per cent growth) if they didn't do all of the interest rate hikes.

The president was implying that the pace of growth previous year could have been over 4 percent without the Fed rate hikes.

In light of global economic and financial developments and muted inflation pressures, the committee said it would go slow on future adjustments to the target range for the federal funds rate and would take decisions at the appropriate time to support those outcomes.

Moore is a visiting fellow for Project for Economic Growth at The Heritage Foundation.

Trump has voiced similar complaints about the Federal Reserve, and the op-ed backs him up by saying that "when President Trump fumed that the Fed's rate increases were smothering his growth policies, he wasn't entirely wrong". At one stage, Trump discussed firing Powell, Bloomberg News reported December 21. He stressed monetary policy in a March editorial in The Wall Street Journal that estimated that Fed policies had cut real growth by as much as 1.5 percentage points in the past six months.

With Trump as president, Moore became a sharp critic of Fed policies to shrink its balance sheet and return rates to what the central bank sees as a neutral level - neither stimulating nor hindering growth.

The FOMC, the Fed's monetary policymaking body, continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 per cent objective as the most likely outcomes, said the statement.

Trump has gone from heckling Fed Chairman Jerome Powell on Twitter to trying to give one of his allies a hand on the levers of U.S. monetary policy. In the article Moore argued that the Fed's rate hikes promoted deflation and described the central bank as the "last major obstacle" to the United States staying on a good path.

The choice of Moore drew broad criticism, as economists across the spectrum noted that Moore's writings and comments seemed to confuse basic concepts, and had been wildly inconsistent over time.

While Moore has sided with Trump in chastising the Fed for raising rates, he has in the past been just as vocal in critiquing the central bank for not raising them.

Powell has said the Fed took those decisions without regard to politics but purely in response to slowing global and US growth and low inflation.

'I don't care if I influenced or not. They did $50 billion a month.

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