President Trump’s top economic adviser said that his boss would “have no weight” in the Federal Reserve’s decisions if he is named to succeed Jerome Powell at the helm of the central bank.
Kevin Hassett, director of the National Economic Council in the White House, was asked during an interview with CBS “Face the Nation” on Sunday whether President Trump’s “voice” would “have equal weighting to the voting members.”
“No, no, he would have no weight. It’s just his opinion matters if it’s good, you know, if it’s based on data,” Hassett told CBS.
“And then if you go to the committee and you say, well, the president made this argument and that’s a really sound argument, I think, what do you think? If they reject it, then they’ll vote in a different way.”
Hassett said that he and Trump “talk about almost everything…almost every day” as it relates to economic policy, including “monetary policy.”
“I think he has very strong and well-founded views about what we ought to do,” Hassett told CBS.
“But in the end, the job of the Fed is to be independent and to work with the group of people that are on the Board of Governors, at the FOMC, to drive a group consensus on where interest rates should be and to do so, you know, basically with the guidance of the Fed chair.”
“But in the end, it’s a committee that votes.”
Hassett said that he would be “happy to talk to the president every day….even if I were Fed Chair or if I wasn’t Fed Chair.”
Last month, Bloomberg News was the first to report that Hassett had emerged as the frontrunner in the race to succeed Powell, whom Trump has frequently criticized due to his reluctance to lower interest rates.
Hassett has been talked about as a finalist alongside Fed governors Christopher Waller and Michelle Bowman as well as former Fed governor Kevin Warsh and BlockRock portfolio manager Rick Rieder.
While the market expects Hassett to be picked, high-level people close to the president have pushed back on his candidacy, The Post reported earlier this month.
Sources told The Post that Hassett is considered by many to be too close to the president.
According to the report, there is concern that Hassett’s proximity to Trump could bode ill for the bond market.
Trump must take heed of sentiment in the bond market because investors collectively set the interest rates that governments, companies and households pay.
A politicized central bank poses risk that could prompt bondholders to sell their debt, thus pushing yields higher.
Observers noted that JPMorgan Chase CEO Jamie Dimon, who is said to maintain a direct line of communication with the president, made remarks last week during a company gathering that were interpreted as signaling support for Warsh, according to CNBC.
While Hassett is viewed as close to Trump, Warsh is perceived by Wall Street as a more traditional Fed pick.
A former Fed governor who advised the central bank during the 2008 financial crisis, he has long argued for a rules-based approach to monetary policy and has criticized the Fed for allowing inflation to get out of control.
The Post has sought comment from the White House and JPMorgan.
