Meanwhile, some speculate that his tenure may depend in part on how much markets continue to drop.
President Trump expressed confidence on Tuesday in Treasury Secretary Steven Mnuchin, who is struggling to contain his first real crisis but has failed to assuage investors unnerved by turmoil in Washington.
Trump told reporters at the White House on Christmas morning that Mnuchin is a “very talented guy, very smart person.” He complained again about the Federal Reserve and its chairman, Jerome Powell, saying that “they’re raising interest rates too fast.”
After weeks of sliding stock prices, Mnuchin convened an emergency meeting with top U. S. financial regulators on Monday, following a call with executives from six major banks the previous day. The Treasury Department issued a statement Sunday saying banks have adequate liquidity for lending, surprising investors who didn’t know that might be an issue.
The moves intensified concerns about the Trump administration’s economic policies, in the wake of a Bloomberg News report that president had discussed firing Powell. Asked Tuesday whether he also had confidence in Powell, Trump said the Fed is raising rates “because they think the economy is so good.”
Even so, Trump’s frustration with Powell over the market’s performance may turn to his Treasury chief, who recommended Powell’s nomination. Before Tuesday’s comments, one person familiar with the president’s thinking said that Trump had weighed dismissing Mnuchin, while another said that Mnuchin’s tenure may depend in part on how much markets continue to drop.
Since taking office, Trump has looked to the stock market as a benchmark for his presidency. Yet much of the gains in equities since his election have been erased by months of turmoil, as investors grow increasingly concerned about the impact of the administration’s trade battles with China and Europe.
After Mnuchin’s call on Monday – which produced no public statement – stocks continued their Christmas Eve slide, ending the day with the benchmark S&P 500 down 2.7 percent, hitting its lowest level in 20 months. The president has acknowledged that he can’t fire Powell, raising speculation he may target Mnuchin.
“There are plenty of people inside the White House who are not fans of Mnuchin who are happy to throw him under the bus,” said Stephen Myrow, managing partner at Beacon Policy Advisors in Washington and a former Treasury official.
