"Trump Has the Right to Express His Views on Interest Rates"
United States Secretary of the Treasury Scott Bessent reiterated his previous stance in support of a strong-dollar policy.
According to Reuters and other outlets on the 4th (local time), Secretary Bessent made these remarks while appearing before the House Financial Services Committee for a hearing that day.
On the 28th of last month, in an interview with U.S. broadcaster CNBC, Secretary Bessent said, "The United States has always had a strong-dollar policy," and when asked whether the United States was intervening in the foreign exchange market to prop up the value of foreign currencies against the dollar, he replied, "Absolutely not."
Regarding the controversy over possible infringement of the Federal Reserve (Fed)'s independence, such as President Donald Trump's pressure for interest rate cuts, he answered that President Trump, Democratic senators, and anyone else has the right to publicly express opinions on the Fed's monetary policy decisions.
When asked, in connection with the recent investigations into Fed Chair Jerome Powell and Fed Governor Lisa Cook, whether he believes President Trump has the constitutional authority to dismiss the Fed chair or a governor because of policy disagreements, he did not state a clear position. He replied that he had no opinion on that question, but that he believes the Fed is an independent institution.
He also pointed out that the Fed's independence is based on the trust of the American people, but that the Fed has lost that trust by failing to control inflation and thereby devastating Americans' incomes. In doing so, he reiterated his previous position that trust in the Fed has been damaged due to the surge in inflation after the COVID-19 pandemic.
At the hearing, Secretary Bessent said that his January 2024 statement, made during the previous Joe Biden administration, that he and Key Square Capital, the firm he founded, believed "tariffs cause inflation," had been a misjudgment. He said that despite the imposition of tariffs after President Trump's return to office, the U.S. economy is growing and inflation is slowing.
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