The US government maintained pressure on the Federal Reserve (Fed) and its president, Jerome Powell, the Treasury Secretary Scott Bessent on Monday, believing that the institution “was effective”.
“I think what we have to do is examine the Fed institution as a whole and ensure that it has been effective,” said Mr. Bessent on CNBC, “what we have to ask ourselves is: did the organization succeed in carrying out its mission?”
Comparing the FED to other government agencies, including the FAA, the Aviation Safety Agency, Scott Bessent said that “if another agency had made so many mistakes, we would all ask ourselves what is going on”.
The American central bank, whose next meeting is scheduled for July 29 and 30, and particularly its boss, Jerome Powell, is the target of regular attacks by the American president, Donald Trump, who accuses him of not acting enough and too late, nicknning him “too late” Powell.
According to Donald Trump, the Fed should have lowered its three percentage points already, in order to support the American economy, believing that such a movement would save “$ 1,000 billion” in interest on public debt, without specifying on what period.
But the FED has so far resisted, arguing that inflation, which had increased sharply after the Pandemic of COVID-19, had still not returned to its 2% long-term objective, provided by its mandate, and that the customs duties wanted by Mr. Trump had on the contrary shot prices upwards.
The CPI index, on which the pensions of Americans are indexed, has indeed rose to 2.7% over one year in June, against 2.4% in May.
The Fed prefers to base itself on the PCE index for its monetary policy, the composition of which is significantly different. It will be published on July 31.
Donald Trump threatened last week to dismiss Jerome Powell, before finally seemed to give it up.
According to the daily Wall Street Journal, this decline intervened after a conversation with Mr. Bessent, who sought to dissuade the American president, information denied Monday by the secretary of the Treasury on CNBC.
