Published: Sat, February 09, 2019
Economy | By

Mnuchin describes 'covert' effort to secretly get Powell into White House

Mnuchin describes 'covert' effort to secretly get Powell into White House

Federal Reserve Chair Jerome Powell, during an informal dinner with President Trump on Monday night, stressed the importance of economic data in establishing the monetary policy set by the USA central bank.

The Fed says Trump and Powell were joined by Treasury Secretary Steven Mnuchin and Federal Reserve Vice Chairman Richard Clarida.

Powell's comments were "consistent with his remarks at his press conference of last week", the Fed said in a statement.

"Readouts" of such meetings are typically left to the White House, but in this case the Fed felt compelled to draw bright lines around what was discussed and what wasn't, an effort to shield Powell from suggestions that Trump is influencing the Fed's decisions, and to prevent a fairly normal Washington event from seeming anything otherwise.

Trump past year repeatedly exerted pressure on the Fed to hold off on rate hikes, saying that the central bank risked impeding economic progress with a tightening monetary policy.

That is, until Trump, who has variously called the Fed "crazy", "out of control", and "my biggest threat". Last week, the Fed signaled that it planned to pause its rate hikes and would be "patient" before raising rates again, an announcement that sparked a huge rally on Wall Street.

"[Powell] did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook", Fed officials said in a statement. It was a casual meeting.

"I have great respect for President Xi, and we are now working on a new trade deal with China", Trump said in the address on Tuesday.

In addition to the the dinner with Trump, Mnuchin holds regular weekly meetings with Powell to discuss economic issues.

Mnuchin said that while the dinner was immediately revealed after it took place, there had been something of a "covert operation" to get Powell into the White House without being seen "so it didn't create speculation" about the objective of Powell's visit. "Chair Powell said that he and his colleagues.will make those decisions based exclusively on careful, objective and non-political analysis".

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