Federal Reserve press conference, 2019-06-19 — Chair Jerome Powell

Question (Heather Long, Washington Post): Hi, Heather Long from the Washington Post. Could you clarify what you would do if the President tweets or calls you to say he would like to demote you as Fed Chair?
Answer: I think the law is clear that I have a four-year term, and I fully intend to serve it.

Question (Christopher Condon, Bloomberg): Thank you. Chris Condon, Bloomberg News. Mr. Chairman, if and when the Committee decides to cut rates, I suspect there’ll be a debate over whether to move by 25 or 50 basis points. Indeed, there’s a pretty substantial body of academic literature arguing that a central bank close to the zero lower bound ought to act sooner and more aggressively than it otherwise would. I’m wondering what you think of that prescription, and if you could spend a couple of minutes discussing the pros and cons of the 50 basis point cut and how you approach that question.
Answer: On the specific question of that, that’s just something we haven’t really engaged with yet, and it will depend very heavily on incoming data and the evolving risk picture as we move forward. So it would be—so nothing I can say about that is specific to the near-term question that we face. More generally, though, the research you refer to essentially notes that, in a world where you are closer to the effective lower bound, it’s why—research kind of shows this—it’s wise to react, for example, to prevent a weakening from turning into a prolonged weakening. In other words, sort of, an ounce of prevention is worth a pound of cure. So I think that is a valid way to think about policy in this era. I don’t know—and it’s always in the—I think it’s in the minds of policymakers, you know, during this era, because it’s well understood to be correct. Again, I don’t know what that means in terms of the size of a particular rate cut going forward. That’s going to depend heavily upon, you know, the actual data and the evolving risk picture.

Question (Victoria Guida, Politico): Hi, Victoria Guida with Politico. You’ve said that the Fed doesn’t take short-term political considerations into account, and you’ve defended the Fed’s independence. So I was wondering, is there a point at which you think that, publicly or privately, you should push back on the President’s criticisms rather than ignoring him? And also, do you think that you and the President have the same goals when it comes to monetary policy?
Answer: You know, I don’t—I don’t discuss elected officials publicly or privately, really. So I would just say that we are—at the Fed, we’re deeply committed to carrying out our mission, and also that our independence from direct political control we see as an important institutional feature that has served both the economy and the country well.