While President Donald J. Trump searches for a new chair of the Federal Reserve, banking leaders like Bank of America Chairman and CEO Brian Moynihan say that without independent banking systems, the market will push back, CBS News reports.
In an interview on “Face the Nation with Margaret Brennan,” Moynihan suggested there is “too much fascination with the Fed” right now amid interest rates being cut down for the third time in a row, reducing the federal funds rate. He warns there will be consequences and that the market “will punish people if we don’t have an independent Fed.” “And everybody knows that,” he told Brennan.
During the COVID-19 pandemic, interest rates fell to almost zero, but in 2022 they began rising again to curb inflation. Following the agency’s meeting in early December, the benchmark interest rates reached their lowest since November 2022.
Moynihan may be correct in his stance on the fascination with the Federal Reserve, thanks to Trump bringing the independent agency to the forefront. Since taking office, the president has expressed displeasure with Federal Reserve Chairman Jerome Powell, who is retiring in May 2026. Then there was his attempt to remove Lisa Cook, who serves on the Board of Governors, and his unsuccessful claim that she committed
mortgage fraud.A 1935 Supreme Court ruling found that Congress may limit the grounds on which the president can fire Fed members, but that didn’t stop the high court from giving Trump the power to fire members of federal labor boards. However, the limit was the Federal Reserve, which was called a “uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.”
Despite numerous attempts to shake things up at the Fed and consumers feeling the weight of Trump’s policies, Moynihan feels the economy is on the
upswing — it may just take some time for consumers to feel it. “It’s pretty solid right now,” he said, according to the Washington Times, while highlighting spending in November being higher than in 2024, wages going up, and unemployment remaining “very low.”“They saw the inflation in ‘20 and ‘23 and ‘24 that was on their minds, and they want to see it subsist, and it’ll take a little while to subsist, but as you go into 26, having come through 25, the incremental hit of that [inflation] would be lower,” the banking CEO continued.
Meanwhile, Republicans are crossing their fingers that a strong
economy and consumer optimism will work in their favor ahead of the 2026 midterm election season, when the Democratic Party has the opportunity to snatch back the House majority. Trump and GOP lawmakers have remained steadfast in telling voters the economy is all thanks to the Biden administration and Democrats.RELATED CONTENT: Hollywood Icons Pose Down In Exclusive IMDb Studio At Black Cinema & Television Celebration