U.S. President Donald Trump and Federal Reserve Chair Jerome Powell met at the White House on Monday morning, the second meeting between the two since Powell became head of the Fed and faced withering criticism from Trump.
The Fed announced the meeting in a morning press release, and Trump on Twitter called the session “good & cordial,” a contrast with prior statements that have included calling U.S. central bankers “boneheads” for not cutting interest rates and labeling Powell personally as an enemy of the United States on a par with China leader Xi Jinping.
“Everything was discussed including interest rates, negative interest, low inflation, easing, Dollar strength & its effect on manufacturing, trade with China, E.U. & others, etc.,” Trump tweeted.
The Fed in its statement was careful to note what wasn’t discussed: Powell’s expectations for future monetary policy. Trump has for more than a year charged the Fed with undermining his economic policies by, in his view, keeping interest rates too high, and depriving the United States of what Trump feels are the benefits of the negative rates of interest set by the European and Japanese central banks.
The Fed has cut rates three times this year – in part to offset what it views as damage done by the Trump administration’s trade war with China. But after its last meeting policymakers signaled they would lower rates no further unless the economy takes a serious turn for the worse.
Powell “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,” the Fed said in its statement.
Powell appeared before congressional committees twice last week, and the Fed said his comments to Trump were “consistent” with his statements to lawmakers.
“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.”
The meeting included Treasury Secretary Steven Mnuchin.
Powell met with Trump in February and has also had at least three brief phone conversations with him. He has also made deliberate efforts to court members of the House and Senate, an important source of support at a time when Trump has expressed regret for ever appointing Powell and reportedly explored whether he could remove him.
Fed chairs are appointed to four-year terms by the president, but once confirmed by the Senate are intended to be insulated from White House political pressure over how to manage monetary policy. They can only be removed “for cause,” not over a disagreement over policy.
Meetings between Fed chairs and presidents are not unprecedented but they are infrequent, as opposed to the nearly weekly sessions that central bankers have with the head of the Treasury.
(Reporting by Howard Schneider; Editing by Andrea Ricci)