Fed Chair Powell Stresses the Importance of Central Bank Independence

Federal Reserve Chairman Jerome Powell stressed the central bank’s independence in a speech Tuesday that comes amid continuous pressure from the White House to cut interest rates.

He spoke during a event at the Council on Foreign Relations in New York that investors were watching closely for clues about the direction of monetary policy.



His remarks mirrored those from last week’s Federal Open Markets Committee meeting, and he emphasized that policy is under review though he did not overtly tip is hand that a rate cut is at hand. Markets are currently pricing in four quarter-point reductions by April 2020.

“Since the beginning of the year, we had been taking a patient stance toward assessing the need for any policy change,” he said. “We now state that the Committee will closely monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion, with a strong labor market and inflation near its symmetric 2 percent objective.”

However, he emphasized that politics won’t be a consideration as the Fed is “grappling” with the idea of a rate cut.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza