The independence of the US Federal Reserve

The US President Trump complained about the US Federal Reserve's decision of rate hikes. The US Fed is supposed to be independent of the government; however, it is never new to hear any government attempt to intervene central banks. Governments love to have central banks on their sides and work together to produce good economic performances to help governments to win more support from their nations' populations. Such reason is understandable; sometimes, it is good to see governments and central banks are working together and making our economies better, especially during an economic crisis period.

When the US president Trump is trying to intervene with the US Fed's decision, it makes people worried. Trump is not a typical politician, and he seems to lack knowledge about governing. In many cases, he acts like a business who only cares about his own personal interests rather than the common values of the community. A businessman does not like the idea of rate hikes, because it means getting financing is more difficult and expensive, meanwhile equity prices tend to be negatively correlated with the interest rate, and the businessman will be poorer due to the depreciation of his(her) equities. I cannot be sure if the US President Trump is against the rate hike because of his personal interest, but I personally think this could be possible.

The US President has power over the US Federal Reserve in terms of its board selection and the current US Fed's chairman is appointed by Trump. At the moment, the US Fed could potentially change its previous policy guidance due to the pressure from the president and this can hurt the credibility and especially the professional of the Fed's decision, though I am not saying pausing rate hikes is a bad thing.