U.S. Federal Reserve Chairman Jerome Powell speaks during the “The Economic Outlook and Monetary Policy” panel discussion hosted by the Swiss Institute of International Studies at the University of Zurich in Zurich, Switzerland September 6, 2019. REUTERS/Arnd Wiegmann
ZURICH (Reuters) – U.S. Federal Reserve Chair Jerome Powell on Friday defended the central bank against the suggestion it would use monetary policy to affect political outcomes or be moved to take action based on political considerations.
“Political factors play absolutely no role in our process, and my colleagues and I would not tolerate any attempt to include them in our decision-making or our discussions,” Powell said at the University of Zurich.
He was responding to an opinion piece from a former Federal Reserve policymaker arguing that the Fed should refuse to “play along” with President Donald Trump’s trade agenda by cutting interest rates and ought to take the outcome of the 2020 presidential elections into account in making rate decisions. The piece generated immense controversy and criticism, including on Friday from presidential economic advisor Larry Kudlow.
Writing by Ann Saphir; Editing by Andrea Ricci