The writer is a professor at the University of California, Berkeley and the author of the forthcoming book ‘Money Beyond Borders: Global Currencies from Croesus to Crypto’
Is the Trump administration’s latest attack on Jay Powell and the Federal Reserve a serious threat to the dollar’s position as the leading international and reserve currency, and therefore to global economic and financial stability? The answer, in a word, is yes.
President Donald Trump has his own personal view of the appropriate level of interest rates, namely that these should be at most 1 per cent or less. Last Friday’s justice department missive threatening a criminal investigation of Powell over renovations at the central bank’s headquarters is a signal that his administration is prepared to go to any length to obtain the desired result.