White House’s Hassett criticises Powell for staying on at Fed

WHITE House National Economic Council Director Kevin Hassett criticised former Federal Reserve Chair Jerome Powell for staying on at the US central bank, a move that’s preventing the administration from putting another pick on the board.

“It’s extremely unorthodox that Jay Powell hasn’t dropped out,” Hassett said on Bloomberg Television on Thursday (Jul 2). “The former chair sitting there is a very unorthodox thing.”

He was responding to a question about whether there were specific members of the Fed he was concerned about, after saying Wednesday on Fox Business that “there’s a majority of people over at the Fed that are not necessarily going to be voting because they’re patriotic, but rather because they want to get Trump.”

Fed policymakers have failed to slash interest rates in the way President Donald Trump has repeatedly called for, and last month left their benchmark unchanged.

The Fed board currently has one member nominated by Trump since taking office for his second term: Newly installed Chairman Kevin Warsh.

Powell, whose term as a governor extends to January 2028, said he’d remain for now. Expressing concern over what he said was a politically motivated investigation of a Fed building project, he said in April he’d depart “when I think it’s appropriate to do so.”

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“I’m concerned about what his motivations are,” Hassett said. On Wednesday, he had said “we’re going to have to keep a close eye on that.” But Thursday he said, “in the end, this is a problem that Kevin Warsh is going to work out.”

Asked whether investigations of Powell were called for, Hassett said “the Fed needs to do its job and they’ve got great leadership there, and we’re going to hope for the best.” BLOOMBERG