President Trump is blaming the Federal Reserve for holding back the economy and stock market, despite the Fed’s decision to do two things he wanted: halt rate increases and stop shrinking its asset portfolio. According to a person who directly heard Mr. Trump’s comments at a meeting, the president recalled a recent phone conversation with Fed Chairman Jerome Powell. “I guess I’m stuck with you,” the president recalled telling Mr. Powell. Mr. Trump has blasted the Fed and Mr. Powell at three meetings in the past week alone.
From reporter Nick Timiraos:
Fed officials have been puzzled by surprisingly muted inflation pressures in recent months, which—together with worries about growth in Europe and China, and increased market volatility late last year—justified their interest-rate pause in the first quarter. One challenge for Mr. Powell that his recent predecessors didn’t face: President Trump’s acerbic criticism—by pre-emptively blaming the central bank for any wobbliness in the economy—could magnify any misstep. Even though Fed officials promise they are tuning out politics, every comment by Mr. Trump will inevitably filter the Fed’s policy decisions through a political lens in the eyes of at least some market participants.