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Trump and Jerome Powell meet on economy, but Fed says decisions will remain ‘non-political’

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Via CNBC

President Donald Trump and Federal Reserve Chairman Jerome Powell, who have been at odds over the direction of monetary policy, met Monday to discuss a variety of economic issues.

The two, along with Treasury Secretary Steven Mnuchin, discussed the economy broadly as well as growth, employment trends and inflation, the central bank said.

Powell’s “comments were consistent with his remarks at his congressional hearings last week,” the Fed said.

On Twitter, Trump said the meeting was “good & cordial.”

In separate meetings with panels on Capitol Hill last week, Powell said he felt that monetary policy was appropriate and likely to hold steady unless there are some significant changes in the economic outlook.

In addition, he said several times that Fed policy is not influenced by political considerations. That’s a key point, considering that Trump has been vocal in his criticism of the Powell Fed, saying that interest rate increases in 2018 were not necessary and that the central bank has been too slow to ease policy this year.

The full statement from the Fed:

At the President’s invitation, Chair Powell met with the President and the Treasury Secretary Monday morning at the White House to discuss the economy, growth, employment and inflation.

Chair Powell’s comments were consistent with his remarks at his congressional hearings last week. He did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming information that bears on the outlook for the economy.

Finally, Chair Powell said that he and his colleagues on the Federal Open Market Committee will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective and non-political analysis.

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CNBC has reached out to the White House for additional comment.

This is not the first time Powell and Trump have met. The two had dinner together in February in a meeting the White House characterized as including “a very good exchange of views.”

However, Trump has been unrelenting in his criticism since then, at one point calling Fed officials “boneheads” for not cutting interest rates more aggressively. Trump appointed Powell as Fed chair in February 2018 as the successor to Janet Yellen.

It’s common practice for Fed chairs and presidents to meet, though Trump’s bashing of the Fed is unusual in how public it has become. Previous presidents were known to try to influence rates but rarely were as open about it.

Yellen and former President Barack Obama, for instance, met in April 2016, but reportedly did not even discuss interest rates.

“I would not anticipate that, even in the confidential setting, that the president would have a conversation with the chair of the Fed that would undermine her ability to make these kinds of critical monetary policy decisions independently,” White House Press Secretary Josh Earnest said before the meeting, according to a USA Today report at the time.

President Richard Nixon, though, reportedly used behind-the-scenes arm-twisting to get his Fed chairman, Arthur Burns, to lower rates heading into the 1972 election.


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