Former President Trump walked back his assertion that he should have input on Federal Reserve interest rate decisions, but defended his right to comment on matters before the central bank.
The Republican presidential nominee suggested earlier this month that he “made a lot of money” so he should “have at least a say” over monetary policy such as interest rates.
But Trump appeared to soften his stance during an interview Monday with Bloomberg.
“I think it’s fine for a president to talk. It doesn’t mean that they have to listen,” Trump said.
“A president certainly can be talking about interest rates because I think I have very good instincts,” he said. “That doesn’t mean I’m calling the shot, but it does mean that I should have a right to be able to talk about it like anybody else.”
“A president certainly can be talking about interest rates because I think I have very good instincts,” he said. “That doesn’t mean I’m calling the shot, but it does mean that I should have a right to be able to talk about it like anybody else.”
In April, The Wall Street Journal reported that Trump’s allies were drafting a plan to erode the independence of the central bank if he wins the presidency in November, alarming experts and investors.
The Trump campaign said the plans should not be considered an official position.
But the former president did break from tradition in his first term when he vocally pressed the central bank to cut rates and publicly clashed with Fed Chair Jerome Powell, who he appointed in 2017.
The former president also told Bloomberg that he “jawboned” about interest rates with Powell during his term and that “it might have had an effect, it might not have had an effect.”
While Powell has repeatedly said the central bank does not make decisions based on politics, interest rates set by a panel of Fed officials has become an increasingly partisan issue as the November election looms.
After more than a year of holding interest rates at 23-year high range of 5.25 to 5.5 percent, the central bank is expected to finally cut borrowing costs at the Federal Open Markets Committee meeting next month.
Democrats in Congress including Sen. Elizabeth Warren (D-Mass.) have been pushing Powell to cut rates as borrowing costs burden Americans, and a cut is widely expected to stimulate economic activity.
But earlier this year, Trump accused the lifelong Republican chair of being “political” and suggested he would cut interest rates as a gift to Democrats in the election.
“It looks to me like he’s trying to lower interest rates for the sake of maybe getting people elected, I don’t know,” Trump told the Fox Business Network’s Maria Bartiromo in February.
“I think he’s going to do something to probably help the Democrats, I think,” he said.
Following Trump’s suggestion that he should have a say in Fed policy earlier this month, White House Council of Economic Advisers Chair Jared Bernstein emphasized the “importance of central bank independence," drawing a clear contrast with the former president.
“History could not be clearer regarding the lasting & damaging inflationary consequences of ignoring this lesson or reversing the hard-earned progress of the past half century,” Bernstein said.
