Top Stories
Top Stories
Markets

Mnuchin says he doesn't believe Fed chief Powell is the 'wrong person' despite Trump criticism

Key Points
  • Treasury Secretary Steven Mnuchin says he doesn't believe Fed Chairman Jerome Powell is the wrong person to lead the central bank despite criticism from President Donald Trump.
  • "I don't feel like I picked the wrong person, but I respect the president's views and his views of the economy," Mnuchin tells CNBC.
  • Trump has said that he's "not even a little bit happy with" Powell and that the central bank is "way-off base" with monetary policy and borrowing costs.
VIDEO5:0205:02
Mnuchin on Fed chair Powell: I don't feel like I picked the wrong person

Treasury Secretary Steven Mnuchin told CNBC on Wednesday that he doesn't believe Federal Reserve Chairman Jerome Powell is the wrong person to lead the central bank despite criticism from President Donald Trump.

"I don't feel like I picked the wrong person, but I respect the president's views and his views of the economy, where he's had tremendous insight," Mnuchin said.

Trump has voiced frustration with Mnuchin over his recommendation to nominate Powell for the Fed's top job as the central bank hiked interest rates throughout 2018.

The president has said that he's "not even a little bit happy with" Powell and thinks the Fed is "way-off base" with its monetary policy. As recently as December, Trump discussed firing Powell because of widespread losses in the stock market in the last three months of 2018.

Trump said last week that the U.S. economy would take off like "a rocket ship" if the Fed lowered borrowing costs and ended its tightening policy.

"I think they should drop rates and get rid of quantitative tightening," Trump told reporters Friday, referring to the Fed's policy of selling securities to unwind its balance sheet. "You would see a rocket ship. Despite that we're doing very well."

Steven Mnuchin, U.S. Treasury secretary
Patrick T. Fallon | Bloomberg | Getty Images

In one meeting, Trump reportedly recalled a phone conversation he had with Powell in March. A person who attended that meeting told The Wall Street Journal that the president said he told Powell, "I guess I'm stuck with you."

Mnuchin also discussed Trump's plans to nominate former GOP presidential candidate Herman Cain and former campaign advisor Stephen Moore to the Fed's Board of Governors. Asked whether he is worried about the Fed's independence with the prospect of two outspoken Trump allies on the board, Mnuchin said he's unfazed.

"I don't think there's any reason whatsoever to be concerned about the independence of the Fed," Mnuchin told "The Exchange " later in the interview. "These are two people the president has confidence in ... and they will go through the normal Senate confirmation process."

Asked specifically about whether Cain should be added to the Fed's board, Mnuchin said:  "I'm not going to make individual comments on individual people. I know Stephen Moore well, I don't know Cain very well."

"But I have every reason to believe the president supports him and feels strong," Mnuchin said. "So yes, I think he should be confirmed."