Federal Reserve Chair Jerome Powell risks clearing the way in which for Donald Trump to win the presidency in 2024 if he doesn’t immediately start cutting rates of interest, a top progressive lawmaker claimed Wednesday.
Ro Khanna, an outspoken California Democrat who has repeatedly blasted Powell over the Fed’s handling of inflation, once more took aim at the highest central banker in an X post on Wednesday.
“Powell should cut rates of interest now given most of inflation was attributable to supply shocks,” wrote Khanna, a member of the Congressional Progressive Caucus.
“If he doesn’t, he would be the person most chargeable for the possible return of Trump.”
After a slate of rate of interest hikes during the last two years geared toward taming inflation, Fed officials have left rates unchanged at each of their last three meetings.
The stock market rallied this month, with the Dow Jones Industrial Average hitting all-time highs, after Fed officials signaled rates cuts were possible in the approaching 12 months — but probably not until the autumn, which could also be too late to assist Biden in November’s presidential battle.
Optimism for imminent cuts cooled earlier this month after Recent York Federal Reserve President John Williams and Atlanta Fed President Raphael Bostic each indicated that confer with bring down rates was premature.
Powell should cut rates of interest now given most of inflation was attributable to supply shocks. If he doesn’t, he would be the person most chargeable for the possible return of Trump. https://t.co/9kK7VkIwij
— Ro Khanna (@RoKhanna) December 27, 2023
As an independent federal institution, the Fed is anticipated to make policy decisions no matter which party holds the Oval Office.
Powell — who was named Fed chair by Trump in 2017 and reappointed by Biden in 2021, against the desires of many progressives == has overseen a gradual stream of hikes that has brought the fed rate to a two-decade high of between 5.25% and 5.50%.
Nonetheless, a “soft landing” from inflation levels that reached four-decade highs could also be in reach. The Consumer Price Index showed inflation rose 3.1% in November, the bottom reading since June, but still stubbornly above the Fed’s 2% long-term goal for prices.
Fed Chair Jerome Powell has repeatedly reiterated that central bankers have a 2% inflation goal. Getty Images
Despite major legal trouble, Trump is the present frontrunner for the Republican Party’s presidential nomination.
A recent poll showed that one other top GOP candidate, the previous US Ambassador to the United Nations Nikki Haley, had pulled inside 4 percentage points of Trump amongst likely Republican voters in Recent Hampshire.
