WASHINGTON: US Treasury Secretary Scott Bessent said on Monday (July 21) that the role and performance of the Federal Reserve should be scrutinised, as President Donald Trump intensified pressure on the independent central bank.
Fed Chair Jerome Powell’s term ends in May 2026, but Trump has recently targeted the Fed’s US$2.5 billion renovation project as a potential justification for removing him.
The fresh criticism follows months of attacks on Powell for keeping interest rates steady this year, despite Trump’s push for aggressive cuts to offset the economic impact of his tariffs.
Asked whether he supported firing Powell, Bessent told CNBC: “I think that what we need to do is examine the entire Federal Reserve institution and whether they have been successful.”
Bessent added he would speak later Monday on regulatory issues, another area in which the Fed plays a key role, one day before the opening of a Fed-hosted conference.
He did not respond to a Wall Street Journal report claiming he had privately advised Trump against firing Powell, citing risks to financial markets, economic stability and the legal hurdles such a move would face.
Bessent told CNBC there had been “very little, if any, inflation” from Trump’s sweeping tariffs and suggested Fed officials “appear unable to break out of a certain mindset.”
Since returning to office in January, Trump has imposed a 10 per cent tariff on goods from most trading partners and higher duties on imports of steel, aluminium and automobiles.
While inflation has remained muted so far, partly because Trump delayed some of the harshest measures, economists say price data over the summer will offer clearer insight into the tariffs’ full impact.
