US Federal Reserve Board Chairman Jerome Powell holds a news conference after a Federal Open Market Committee meeting in Washington, DC, December 19, 2018. - The US central bank raised the benchmark borrowing rate on Wednesday, December 19, 2018 but gave the clearest sign to date that it will go slow on additional increases as it watches the economy. (Photo by Jim WATSON / AFP)        (Photo credit should read JIM WATSON/AFP/Getty Images)
Fed raises rates despite Trump's warning
00:54 - Source: CNN
CNN  — 

The White House sought to project a message of stability on Wednesday about the US economy amid ongoing market volatility triggered in part by confusing signals sent in recent days by President Donald Trump and his top advisers.

Kevin Hassett, the chairman of the Council of Economic Advisers, told reporters Wednesday that Federal Reserve Chairman Jerome Powell’s job is “100%” safe, despite Trump’s vocal complaints about the central bank’s decision to raise interest rates – including in comments to reporters on Christmas Day.

Hassett instead blamed market volatility on “fundamentals,” noting, “Growth in Europe has slowed; growth in Asia has slowed.”

But he said the US economy continues to be strong.

“All the anecdotal info that we’re getting is that the fundamentals remain extremely sound,” Hassett said. “Christmas sales were through the roof.”

The attempt at reassurance from a chief economic adviser to Trump came as Wall Street sought to pick up following its worst Christmas Eve performance on record and the partial government shutdown went through its fifth day.

Markets rebounded sharply Wednesday from a disastrous Christmas Eve. The Dow was up 500 points by midday, the S&P 500 rose 2.4% and Nasdaq was up about 3%.

Throughout the holiday period, Trump has railed against the Federal Reserve, tweeting at one point that it was the “only problem our economy has.”

The President’s continued campaign against Powell, a former investment banker chosen last year by Trump to succeed Janet Yellen, breaks the decades-old precedent of shielding the world’s most powerful central bank from political meddling – but is in keeping with Trump’s habit of publicly railing about appointees and aides he believes are damaging his political standing.

Aides are exploring the possibility of having Trump meet personally with Powell in the new year, a person familiar with the discussions told CNN.

Some of the President’s aides believe a face-to-face meeting could help ease tensions and allow the two men to discuss the underlying economy.

Mnuchin meets regularly with Powell and it is not unheard of for a Fed chair to meet with the President, though it is rare because the position is meant to be independent of politics.

Nothing has been formally scheduled. The Wall Street Journal first reported the discussions about the meeting.

Over the weekend, Treasury Secretary Steven Mnuchin set off market anxiety after he sought to reassure investors about the partial shutdown with a statement saying that major banks have “ample liquidity.”

Far from calming the markets, the moves seemed to exacerbate Wall Street concerns. A source told CNN afterward that Trump’s frustration with Mnuchin had grown, although Trump publicly vouched for Mnuchin on Christmas.

Hassett reiterated on Wednesday that there’s no liquidity crisis, as there was in 2008.

He also dismissed questions about whether the partial shutdown will affect the economy or if it has played a role in market volatility.

“In the end, a few week shutdown is not going to be something that has any kind of significant effect on the outlook,” he said.