JP Morgan chief defends independence of Fed chair amid Trump attacks | Federal Reserve

The boss of JP Morgan Chase, Jamie Dimon, has defended the “completely crucial” independence of the Federal Reserve chair, as Donald Trump continues to demand instant cuts in rates of interest.The US treasury secretary, Scott Bessent, stated on Tuesday {that a} formal course of for selecting a successor to the Fed chair, Jerome Powell, had already begun – even supposing his time period doesn’t finish till subsequent Could.Trump has repeatedly criticised Powell, calling him “very dumb” and a “main loser”, and urging him to slash rates of interest. The president posted a handwritten word to Powell on social media final week, saying: “You will have price the USA a fortune and proceed to take action. You must decrease the speed – by loads!”Powell has stated in flip that charge cuts have been delayed by Trump’s tariff insurance policies, which many policymakers concern will enhance inflation. Information for June, revealed on Tuesday, confirmed the annual charge of inflation rising to 2.7%, from 2.4% a month earlier.Talking to reporters as JP Morgan reported its quarterly earnings on Tuesday, Dimon cautioned in opposition to interfering with the workings of the US central financial institution.“The independence of the Fed is completely crucial – and never only for the present Fed chair, whom I respect, Jay Powell, however for the following Fed chair,” he stated. “Taking part in round with the Fed can typically have opposed penalties, absolutely the reverse of what you is perhaps hoping for.”Dimon’s remarks got here as Bessent advised Bloomberg TV that the White Home would press forward with selecting a substitute for Powell. “There are a variety of nice candidates. And we’ll see how quickly it progresses. It’s President Trump’s resolution and it’ll transfer at his pace,” he stated.Powell was given a spherical of applause by fellow central bankers at a European Central Financial institution convention earlier this month in Sintra, Portugal, when he was requested concerning the president’s assaults.White Home insiders have despatched conflicting alerts about Powell’s future. Bessent advised Trump wouldn’t sack the Fed chair.“President Trump’s stated quite a few occasions he isn’t going to fireplace Jay Powell,” the treasury secretary stated, including: “I believe an impartial central financial institution is essential for the conduct of financial coverage.”However Kevin Hassett, director of Trump’s nationwide financial council, stated over the weekend that eradicating Powell was “being regarded into”. Hassett is considered a possible contender for the function himself.Fed independence is seen as essential to sustaining traders’ confidence, with policymakers deemed extra probably to have the ability to convey inflation underneath management with out political interference.Trump’s earlier assaults on Powell had been seen as one issue behind the bond market selloff on Wall Road in April that led to the 90-day “pause” on tariffs – a deadline that has since been prolonged from 9 July to 1 August.