Test for new Fed chair? Rate cut: POTUS

President Donald Trump indicated he would judge a new Federal Reserve chair by whether they immediately move to cut interest rates.

Trump responded "yes" when asked in an interview with Politico if a quick reduction of borrowing costs would be a litmus test for his handpicked central bank leader.

"Yes. Well, this guy too ... should too," Trump said in and interview, referring to current Fed Chair Jerome Powell. "I think he's a combination of not a smart person and doesn't like Trump."


Trump's comments were a key signal to potential new Fed chairs on what the president would expect from them if they were to be nominated to lead the central bank.

White House National Economic Council Director Kevin Hassett, a frontrunner in the race for Fed chair, said last month the data suggests that the central banks should cut rates right "right now."

On Monday Hassett said it would be irresponsible for the Federal Reserve to lay out a plan for where it aims to take interest rates over the next six months, saying the central bank chair's job is to watch the economic data and then make decisions.

Trump, earlier this year, repeatedly called for the Federal Reserve to get its benchmark down below 2%, versus the current target of 3.75% to 4%.

Powell and his colleagues are expected to take the benchmark down by 25 basis points in a decision due Wednesday.