In the US, they predicted a negative perception by the markets of Trump's policy towards the Fed
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- In the US, they predicted a negative perception by the markets of Trump's policy towards the Fed
Any attempt to limit the independence of the US Federal Reserve System (FRS) "will have a very bad effect on the markets." The Financial Times (FT) newspaper wrote about this on July 25 with reference to the American investment fund Pimco.
"Markets value the independence of central banks, at least as far as setting interest rates is concerned... Any attempt to limit independence will be very negatively perceived by the markets," Dan Ivashin, Pimco's chief investment officer, said in a conversation with the publication.
In his opinion, the idea that Fed Chairman Jerome Powell should resign in order to maintain independence, which is called for by American leader Donald Trump, is not at all "reasonable."
"We believe that a good independent Fed chairman will finalize the deadline and then decide what to do next. From the point of view of the bond market, it is important to continue receiving positive signals that he will be able to complete his term of office," he added.
Since the beginning of April, Trump has been calling on Fed Chairman Jerome Powell to lower the key rate and even threatens to fire him, but he has not changed his chosen course. On July 16, Bloomberg noted that the dollar index (DXY) began to decline sharply amid Trump's plans to remove the Fed chairman from office. On the same day, CBS News reported that the American leader had consulted with Republicans in Congress on Powell's dismissal.
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