ECB frets at prospect of Trump ally running US central bank

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Stress marketing campaign

Trump has repeatedly attacked the Fed since returning to workplace in January, blasting Powell — whom he appointed as Chair throughout his first time period — as a “numbskull” and a “main loser” for not slicing rates of interest extra shortly.

The Fed withstood the strain till September, when indicators of a slowdown within the labor market emerged. It lower charges once more in October, however Powell upset these anticipating extra easing quickly by warning that one other lower in December is under no circumstances “a completed deal.” Since then, a number of of his colleagues on the Federal Open Markets Committee have expressed reluctance to chop any additional in December, pointing to an inflation charge caught above the two % goal.

<img decoding="async" width="1024" height="721" src="https://www.politico.eu/wp-content/uploads/2025/12/04/GettyImages-2249465219-1024x721.jpg" alt="" class="wp-image-7610925" srcset="https://www.politico.eu/cdn-cgi/image/width=1024,quality=80,onerror=redirect,format=auto/wp-content/uploads/2025/12/04/GettyImages-2249465219.jpg 1024w, https://www.politico.eu/cdn-cgi/image/width=300,quality=80,onerror=redirect,format=auto/wp-content/uploads/2025/12/04/GettyImages-2249465219.jpg 300w" sizes="(max-width: 1024px) 100vw, 1024px"/> Extra lately, as Jerome Powell has come below hearth from the White Home, European colleagues have rushed to defend him.

Often, when the labor market weakens, so does inflation, however that hasn’t occurred this time. At each of his final two press conferences, Powell famous that the Fed’s twin mandate of protecting costs secure whereas pursuing full employment had been presently “in stress” with one another.

Hassett has introduced a really totally different view, telling CNBC in November that “inflation has come manner down” from the 5 % that it averaged throughout Joe Biden’s presidency andthat “the trajectory is admittedly, actually, actually good in the event you have a look at it.” That’s regardless of U.S. headline inflation truly rising in 4 of the final 5 months.

My good pal Ben

That's the reason many in Frankfurt see various candidates — together with the dovish however skilled Fed Governor Christopher Waller — as far safer decisions. Additionally nonetheless within the working, in keeping with varied sources, are former Fed Governor Kevin Warsh, BlackRock fixed-income chief Rick Rieder, and sitting Governor Michelle Bowman.

For many years, relations between the Fed and the ECB have been collegial and cooperative. Members of the small, globally linked circle of central bankers have lengthy seen themselves as a type of fraternity. In the course of the peak of the 2008 monetary disaster, then-ECB President Jean-Claude Trichet preferred to emphasise that closeness by repeatedly referring to Fed Chair Ben Bernanke as “my good pal Ben.”