Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.

    SUBMIT

Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence

Disclaimer:

Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » World
2-min read

US Federal Reserve Should Help Defeat Trump in 2020 Elections, Says Ex-Fed Official

Bill Dudley, the influential former president of the New York Federal Reserve Bank, also said the Fed should not 'enable' Trump's escalating trade war with China by lowering interest rates.

AFP

Updated:August 28, 2019, 8:25 AM IST
facebookTwitterskypewhatsapp
US Federal Reserve Should Help Defeat Trump in 2020 Elections, Says Ex-Fed Official
FILE PHOTO: A man walks past the Federal Reserve Bank in Washington (REUTERS)
Loading...

Washington: A former top US central banker leapt into the political fray on Tuesday, calling on the Federal Reserve to oppose President Donald Trump's reelection effort next year.

Bill Dudley, the influential former president of the New York Federal Reserve Bank, also said the Fed should not "enable" Trump's escalating trade war with China by lowering interest rates.

The stunning arguments in a Bloomberg opinion column flew in the face of efforts by current Fed officials to remain strictly neutral and above partisan politics, despite Trump's intense year-long campaign to demand easier monetary policy.

But Dudley said the outcome of the 2020 presidential elections was arguably "within the Fed's purview" because a second Trump term represented a threat to the global economy as well as to the Fed's political independence and policy mandates.

"If the goal of monetary policy is to achieve the best long-term economic outcome, then Fed officials should consider how their decisions will affect the political outcome in 2020," he wrote.

Trump already blames the Fed, rather than trade policy, for the slowing economy and has demanded drastic cuts in interest rates in his relentless, nearly daily attacks.

Last week he called Fed Chairman Jerome Powell an "enemy" and on Tuesday tweeted that central bankers loved "watching our manufacturers struggle" to export to markets with easier monetary policy.

Powell, when asked, has consistently brushed off Trump's near-daily invective, saying Fed officials do not take politics into account when deciding on policy.

A spokesman for the central bank maintained this position on Tuesday, saying the Fed's policy decisions were guided "solely by its congressional mandate" for stable prices and maximum employment.

"Political considerations play absolutely no role," the spokesman said in a statement.

Earlier this month, the Fed cut interest rates for the first time in more than a decade even though unemployment remains at historic lows, amid growing concerns about the global economy.

And investors overwhelmingly expect the Fed to deliver at least a 25-basis-point rate cut next month as the economy slows and the US-China trade war drags into its second year.

But Dudley, who also served as the vice chairman of the Fed's rate-setting Federal Open Market Committee, said in his op-ed that providing more stimulus could encourage Trump to escalate a "disastrous" trade war with China, which deteriorated sharply last week.

"The central bank's efforts to cushion the blow might not be merely ineffectual. They might actually make things worse," he wrote.

Instead the Fed should clearly state that it will not cut rates in response to Trump's trade actions, sending a signal that he will own the risks created by his trade wars -- "including the risk of losing the next election," Dudley said.

Dudley retired from his post as New York Fed president last year and is currently a senior research scholar at Princeton University.

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

Read full article
Loading...
Next Story
Next Story

Also Watch

facebookTwitterskypewhatsapp

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results