Federal Reserve Chairman Jerome Powell confirmed on Wednesday that the upcoming US presidential elections will not have an impact on the bank’s decisions regarding interest rates, adding that policymakers agree to keep political considerations away from the decision-making process.
Powell added in a press conference after the end of the latest monetary policy meeting that what drives the bank in making decisions is “what we believe is the right thing for the economy,” reaffirming a long-standing position that ignores politics in the bank’s economic analysis.
Powell said, “We are on a path in which we serve all the American people, and we make our decisions based on data and how that data affects expectations and the balance of risks.”
The issue of the independence of the US Central Bank returned to the spotlight last week when the Wall Street Journal reported that allies of former President Donald Trump were working on drafting proposals that would seek to undermine the independence of the central bank and give Trump more influence over the bank if he wins the elections scheduled for November 5.
Federal Chairman Jerome Powell told reporters about the election, “We are aligned on it, and we know that we will do what we think is the right thing.”
Powell suggested during a press conference that lowering interest rates would take “longer time than expected.” While stressing that the financial institution is prepared to keep interest rates at their high levels for as long as appropriate, Powell added that “it is unlikely that raising (interest rates) will be the next step in monetary policy” for the United States.
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