What Trump Can (and Can’t) Do to Steer Fed Policy

President Donald Trump is unhappy that the U.S. Federal Reserve under the chairman he chose, Jerome Powell, raised interest rates. But while the president can order military operations, issue rules by executive order, convene Congress and pardon criminals, he can’t do much about the Fed. That doesn’t mean Trump isn’t trying.

In a series of tweets, interviews and off-the-cuff remarks that break with recent precedent among occupants of the White House, Trump has accused the Fed of "unnecessary and destructive actions." Had it not "mistakenly raised interest rates," he tweeted on March 29, U.S. gross domestic product and stock prices "would have both been much higher." He’s called the Fed "the only problem our economy has" and "a much bigger problem than China" and said he’s "not even a little bit happy with with my selection" of Powell as chairman. After nine increases since 2015, the last seven during his presidency, Trump wants the Fed to reduce interest rates and resume buying government securities to increase the money supply, the stimulative activity known as quantitative easing.