Trump's demands of next Fed Chair signals end of central bank independence - Analysts

"I want my new Fed Chairman to lower Interest Rates if the Market is doing well, not destroy the Market for no reason whatsoever," Trump wrote on his Truth Social media site on Tuesday. "Anybody that disagrees with me will never be the Fed Chairman!"

Following Trump's post, analysts on the economy and across a broad range of markets expressed concern at his growing boldness in dictating what the Fed and its chief should do in appeasing a president who has made no secret of his desire for ultra-low or even zero rates.

US rates are currently in a range of between 3.5 per cent and 3.75 per cent after three rate reductions this year by the Fed, each coming after immense pressure for cuts applied by Trump and his cabinet. Of the Fed's 12 voting members, at least four are aligned to the president who spent considerable time and energy this year in trying to reshape the central bank.

"My concern from Day One is the stewardship of the monetary system and economy in the hands of a Fed chief who takes orders from the president and will not defy the president," Ramesh Mohan, professor of economic analytics at Bryant University in Rhode Island, told RIA Novosti.

"It's becoming increasingly clear each day that that's what the president wants," Mohan added.

Incumbent Fed chair Powell is due to retire in May but Trump has been speaking of his replacement since returning to the White House in January for a second term. The president is considering a number of candidates who currently serve him in economic roles on the White House's advisory panel and on his cabinet. But most analysts seem to agree that one who gets the job will be a yes-person for lower rates -- and whatever else the president desires.

--BERNAMA-SPUTNIK/RIA NOVOSTI