Trump rips Fed Chair Powell: We should have ECB's Draghi instead
President Trump on Wednesday said the U.S. would be better off if European Central Bank President Mario Draghi led the Federal Reserve, instead of its current chairman, Jerome Powell.
“European nations were set up in order to take advantage of the United States. It was set up for trade in order to take advantage, and they have. You know, they very smartly have. And they have Draghi who is – we should have Draghi instead of our Fed person,” Trump said in response to whether he is working on a deal with Europe, during an exclusive interview with FOX Business’ Maria Bartiromo.
Trump praised Europe’s efforts to stimulate the economy by lowering interest rates and purchasing financial assets.
“What Europe did with Draghi is they’re forcing money in, we’re doing the opposite. We’re taking money out and we’re raising interest rates – it’s insane,” he said.
“[Powell] should have never raised the rates to the extent that he did," Trump added. "If he would have raised them half – just half – and if he would have not done the quantitative tightening, our market would have been up another 10,000 points. And I’ll tell you, GDP would have been up another point or two points. We could have hit – we potentially could have hit 5 [percent]."
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Powell warned in a speech on Tuesday that “short-term political pressure” can damage the central bank’s independence.
“Congress chose to insulate the Fed this way because it had seen the damage that often arises when policy bends to short-term political interests,” Powell said during a speech at the Council on Foreign Relations. “Central banks in major democracies around the world have similar independence.”
Trump in a Tweet on Monday echoed his frustration with the Fed and Powell, whom he has reportedly considered firing. However, Trump said on Wednesday, “I never suggested I was going to do that. I do have the right to do it.”
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Trump’s comments also come on the heels of accusing Draghi of currency manipulation.
“Mario Draghi just announced more stimulus could come, which immediately dropped the Euro against the Dollar, making it unfairly easier for them to compete against the USA,” Trump wrote in a tweet. “They have been getting away with this for years, along with China and others.”
FOX Business’ Megan Henney contributed to this article.