TechFlow News, February 5: According to a report by Phoenix Net, U.S. President Donald Trump stated on February 5 that Kevin Warsh would not have been nominated for Federal Reserve Chair if he had previously expressed a desire to raise interest rates.
“If he came in and said, ‘I want to raise [rates],’ he wouldn’t get the job—no,” Trump told NBC News in an interview on Wednesday.
Trump said there is “not much” suspense regarding the Fed’s rate cuts because “our rates are too high,” but added that “we’re now a wealthy nation again.”
When asked whether Warsh understands the president’s desire for him to lower the benchmark interest rate, Trump replied: “I think he understands, but I think he wanted to do it anyway.”
Trump’s remarks may be raised during Warsh’s confirmation process, where the Fed’s independence is likely to become a central issue.
Thom Tillis, a Republican senator on the Senate Banking Committee, has already pledged to block any of Trump’s nominees to the Federal Reserve until the Department of Justice concludes its investigation into the Fed’s headquarters renovation project.
Outgoing Chair Jerome Powell described the investigation as a nearly overt attack on the Fed’s ability to independently set monetary policy. Trump administration officials have denied this, though Trump himself has pressured Powell to cut rates for several months.
Warsh previously served as a Federal Reserve governor and was known as an inflation hawk, but he has recently voiced support for rate cuts.
