Fed vs. inflation

Trump: Close majority – can force interest rate cut

Soon Donald Trump will have a majority of his own nominations on the Federal Reserve board. He said this during a cabinet meeting the day after he tried to fire Fed Governor Lisa Cook, writes CNBC.

With a majority, Trump plans to push through his desire for lower interest rates.

– When we have a majority, the housing market will take off, and it will be fantastic, he says and continues:

– People are paying far too high interest rates. We have to get interest rates down a little.

Experts: Trump has a weak base against Cook

Several analysts state that Donald Trump can fire the questioned Fed Governor Lisa Cook if there is “reason”, writes international media. But the question is whether he has evidence for this.

Reuters writes that a similar question has never been tried by a president. Peter Conti-Brown, a researcher in the history of the Fed at the University of Pennsylvania, points out that the mortgage transactions for which Cook is expected to be investigated took place before she joined the Fed. In addition, they were in public records when she was reviewed and confirmed by the Senate.

– To turn back the clock in retrospect and claim that previous events should now be grounds for removal contradicts, in my opinion, the whole idea of ​​a removal on objective grounds, he says.

JPMorgan points out that Cook's removal will likely be a long legal process and that she will probably be allowed to stay in office in the meantime, writes CNBC.

Chief economist on Trump's move: "Dangerous path"

The announcement that Donald Trump is firing Fed Governor Lisa Cook is seen as a clear escalation in the president's battle with the central bank. This is what Swedbank's chief economist Mattias Persson tells TT.

“This is a dangerous path,” he says, pointing out that Trump’s actions are affecting the world’s financial markets.

However, Persson adds that Trump probably does not have the mandate to get rid of the Fed chief. For a dismissal, Cook must be convicted in court, which now makes Trump’s move a mere accusation, he says.