Philly Fed President Comfortable Holding Interest Rates Steady

Patrick Harker, the former president of University of Delaware and head of the Federal Reserve Bank of Philadelphia, told the Wall Street Journal that he sees no need to lower interest rates.

Harker does not sit on the committee of the Federal Reserve which votes on rate increases or decreases. However, all governors of the Federal Reserve participate in discussions on interest rates. Membership on the committee rotates among Fed governors.

The Journal noted that Harker did not favor a recent interest rate increase by the central bank but did not see the rate hike hurting the economy. He also stated that a rate cut would not be a mistake, but added that a wise course would be to keep rates steady.

Harker said he would favor lowering the rate if the economy weakens.

The failure to cut interest rates has drawn the wrath of President Trump who believes lower rates would turbocharge the economy. He has also criticized Federal Reserve Chair Jerome Powell. Powell said the board will retain its independence, but did not rule out a rate cut.

Trump has drawn support for a rate cut in some quarters, due to his administration's continuing trade battles and signs that economies in other nations are slowing down.