

Mint Quick Edit | The US Fed’s rate call this week: White House whim is unlikely to play a role
Subscribe to enjoy similar stories. US President Donald Trump’s open attempts at glaring the Federal Reserve down into rate cuts notwithstanding, it looks unlikely that America’s central bank will oblige as its two-day monetary policy review begins on Tuesday. Inflation is still above the Fed’s 2% target and could rise more as the economy gains momentum on the back of past cuts.
The Fed’s last rate call, a cut, was clouded by economic data gaps in the wake of a government shutdown. Data for recent months that’s now available shows an economy that hasn’t changed much since then. This time, a rate cut seems unlikely, with some expecting the status quo to last till around mid-year.
Meanwhile, what shape US monetary policy formulation takes once Fed chair Jerome Powell exits that role in May is a matter of feverish speculation. Trump is expected to announce a new chief this week. If global markets detect an end to the Fed’s independence, as Harvard professor Gita Gopinath recently pointed out, it could spell a turning point for the dollar’s supremacy in the world’s financial affairs.
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