Donald Trump says a future US rate hike is not solely Kevin Warsh's decision, pointing instead to the Federal Reserve's voting board. Speaking to Punchbowl News, Trump also renewed his public confidence in the Fed chair.
Trump said a potential rate hike is not entirely up to Warsh, telling Punchbowl News that the Fed chair oversees a board that is highly political and that the final call belongs to the wider committee. He also reiterated his confidence in Warsh, saying: "I think Warsh is great. I won't criticize him."
However, interest rate decisions are set by the Federal Open Market Committee on a majority-vote basis rather than by the chair alone. The Fed chair remains the most influential voice on the panel, but that limits how much control Warsh alone would have over any future rate hike.
The voting panel includes the seven members of the Board of Governors, the president of the New York Fed, and four of the remaining regional Fed presidents on a rotating basis. Each member casts an independent vote at every policy meeting, so the chair cannot raise or cut rates without majority support.
As a result, Warsh would need backing from other voters even if he personally favored holding rates steady. Trump's remarks distance Warsh from sole responsibility for any future rate move while still reflecting his public support for the Fed chair.
Source: InvestingLive
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