On December 14 local time, Hassett, the director of the National Economic Council at the White House, publicly stated his position regarding potentially taking over the Federal Reserve, emphasizing that he 'considers Trump's opinions but maintains decision-making independence.' This stance has become a key signal for the market to interpret the future direction of the Federal Reserve's policies. In the context of Trump about to start a new presidential term with a strong desire to intervene in Federal Reserve policies, Hassett's statement demonstrates a communication posture towards the executive branch while also delineating the red line of central bank decision-making independence, injecting complex expectations into the market's game of expectations.
Hassett's statement highlighted that 'listening' and 'independence' are the core keywords. He openly stated that he would 'be willing to talk to the president every day,' acknowledging that Trump's policy views 'are well-founded.' This open stance contrasts sharply with the previous tense relationship between the Federal Reserve and the White House. Trump repeatedly criticized the Federal Reserve's monetary policy as 'behind the curve' during his campaign, advocating for interest rate cuts to boost the economy. Hassett's willingness to communicate seems to provide a channel for expressing the policy demands of the executive branch and is seen by the market as a signal that the Federal Reserve is seeking policy coordination.
But more critically, Hassett clearly delineated the boundary between 'opinion reference' and 'decision-making leadership'. He emphasized that the Federal Reserve's interest rate decisions will 'remain independent', and FOMC voting members can 'freely reject presidential opinions'. Trump's views will only be considered when they are 'data-driven and reasonable'. This statement directly addresses the market's core concerns—there were widespread worries that the Trump administration would excessively intervene in central bank decisions, undermining the Federal Reserve's independence. Hassett's statement essentially reaffirms the operational principles of the Federal Reserve as an independent institution, alleviating market fears of 'politicizing monetary policy'.
From a market impact perspective, Hassett's statement presents a 'neutral and stable' effect. Risk assets such as cryptocurrencies and US stocks reacted mildly; Bitcoin fluctuated around $89,000, and US stock index futures experienced slight volatility, reflecting the market's belief that Federal Reserve policy would not take an 'abrupt turn' due to political demands. On one hand, Hassett's communication stance reduces the risk of policy conflict and alleviates market concerns about 'policy infighting'; on the other hand, the commitment to 'decision-making independence' reassures investors that the Federal Reserve will continue to focus on economic data such as inflation and employment for policy formulation rather than merely catering to executive goals.
It is noteworthy that Hassett's position also reflects the Federal Reserve's wisdom for survival in the new political cycle. The Trump administration's demand for economic growth and employment is not entirely opposed to the Federal Reserve's dual goals of 'controlling inflation and stabilizing the economy'; moderate communication can reduce policy friction. However, the independence of the central bank is the cornerstone of maintaining market trust. Hassett's statement seeks to strike a balance between 'communication and cooperation' and 'independent decision-making', responding to the policy expectations of the executive branch while upholding the institutional bottom line of the Federal Reserve.
For the financial markets, this statement signifies that future Federal Reserve policy will exhibit features of 'data-driven + communication optimization'. In the short term, the market will focus more on fundamental indicators such as inflation data and employment reports rather than political demands; in the long term, if Hassett ultimately becomes the chair of the Federal Reserve, his 'balancing act' may become a new paradigm for interaction between the Federal Reserve and the White House, avoiding policy extremism while preserving core space for central bank independence. This balance will also become an important variable influencing the dollar's movements, global liquidity, and even the pricing of risk assets such as cryptocurrencies.
