Fed’s Powell says credibility lost if President can fire officials

Former Federal Reserve (Fed) Chair Jerome Powell said the US central bank would damage public trust that’s required to support a strong and stable economy if any president were free to dismiss Fed officials over policy disagreements, Bloomberg reported on Monday.

Powell’s remarks came as the US highest court is deliberating the fate of Fed Governor Lisa Cook, whom US President Donald Trump has sought to fire over unproven mortgage fraud allegations. Cook has denied the charge.

Key quotes

If any administration finds a way to remove Fed officials over policy differences, then future administrations will do so as well.

The Fed’s credibility would be lost.

Our credibility has been built and sustained over many decades, and we have a duty to safeguard that priceless asset for our fellow citizens and for generations to come.

Market reaction 

At the time of writing, the US Dollar Index (DXY) is up 0.13% on the day at 99.05.