Harris says she would never interfere in Fed independence

11 August 2024 - 11:33 By Jeff Mason
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US Vice President and Democratic presidential candidate Kamala Harris with Minnesota Governor Tim Walz, Gabby Giffords, and Mark Kelly at a campaign rally, in Glendale, Arizona on August 9 2024.
US Vice President and Democratic presidential candidate Kamala Harris with Minnesota Governor Tim Walz, Gabby Giffords, and Mark Kelly at a campaign rally, in Glendale, Arizona on August 9 2024.
Image: Go Nakamura/REUTERS

US Vice President Kamala Harris said on Saturday that she disagreed strongly with rival Donald Trump's views on the Federal Reserve and pledged not to meddle with the central bank if she wins the November 5 presidential election.

Harris' view contrasts sharply with that of the Republican nominee and former president, who on Thursday said that US presidents should have a say over the Fed's decisions.

“The Fed is an independent entity and as president I would never interfere in the decisions that the Fed makes,” Harris, the Democratic presidential nominee, told reporters in Phoenix, Arizona.

Harris, speaking before flying to Las Vegas for a campaign rally, said she planned to unveil policy positions next week.

“It'll be focused on the economy and what we need to do to bring down costs, and also strengthen the economy overall,” she said.

A jump in the July US unemployment rate reported last week helped to spark a global stock market rout that continued into Monday before equities made a partial recovery. Investors had taken flight because of fears of a potential US recession and that the Fed would need to act aggressively in response.

Asked about those concerns and how the Fed would react, Harris said: “As we know, there was turbulence this week, but it seems to have settled itself. And we'll see what ... decisions they make next.”

Trump's comments on Thursday offered the most explicit indication so far of his interest in infringing on the Fed's independence should he regain the White House.

“I feel the president should have at least (a) say” on Fed decisions, Trump told reporters at his Mar-a-Lago residence in Florida.

His comment followed a Wall Street Journal report this spring that said Trump allies have drafted proposals that would attempt to erode the central bank's independence if he wins.

While the Trump campaign distanced itself from the report at the time, his latest remarks indicate that he is squarely aligned with one of the main thrusts of the proposals; that the president should be consulted on interest rate decisions and that Fed banking regulation proposals should be subject to White House review.

Fed chair Jerome Powell, who was appointed by Trump and reappointed by President Joe Biden, is due to serve until May 2026.

Trump repeatedly criticised and commented on the Fed while he was in office, a departure from the practice of other US presidents.

Reuters


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