The U.S. Treasury Secretary, Biden, refuted the notion that European countries might sell U.S. Treasury bonds and revealed that the Trump administration could announce the new Federal Reserve Chair as early as next week. This statement aims to stabilize market confidence in the demand for U.S. Treasuries while providing a clear timeline for the leadership transition at the Fed.
According to media reports, Biden said on Tuesday at Davos that the claim of European countries selling U.S. Treasury bonds was "completely illogical" and that there had been "no such discussion" from Europe. He called this narrative "wrong" and expressed his "strong opposition" to it.
The Treasury Secretary also confirmed that President Trump "may announce the new Federal Reserve Chair as early as next week," with "four outstanding candidates" currently under consideration. Previously, Biden had stated that Trump planned to make this decision in January, possibly around the time of the World Economic Forum in Davos.
The new chair will take over a central bank caught between institutional independence and administrative demands. Over the past year, the current chair, Powell, has faced repeated criticism from Trump over the pace of interest rate cuts, and the market is worried that the new chair's political leanings may cause fluctuations in the bond market and affect the dollar's trajectory.
Claims of U.S. Treasury Sales Are Refuted
Biden clearly denied recent market rumors that European countries might sell U.S. Treasury bonds at Davos. According to Bloomberg, the Treasury Secretary said, "Europe has no such discussion," and called these claims "completely illogical."
His response to these rumors was firm, stating that he "could not be more opposed" to this view. This statement aims to stabilize market confidence in the future demand for U.S. Treasuries, especially against the backdrop of global major creditors' movements being closely watched.
He also said that Europe is a center of regulatory chaos and urged all countries to abide by trade agreements.
The Federal Reserve Chair Appointment Is Imminent
The Trump administration is accelerating the process of replacing the Fed's leadership. Biden revealed that the president may announce the new chair as early as next week, with four candidates currently under consideration. These candidates include Rick Rieder of BlackRock, Kevin Hassett, the National Economic Council Director, Christopher Waller, a Fed governor, and former governor Kevin Warsh.
Hassett, who had been seen as the front-runner, recently faced public hesitation from Trump. At a White House event, Trump told Hassett: "If you want the truth, I actually wanted to keep you in your current position." This statement reflects the administration's concern about losing an important voice in economic policy, although it is unclear whether this indicates a real shift in internal considerations.
Rick Rieder, the chief investment officer of BlackRock's global fixed income, has recently gained attention. According to sources, he is considered to face less resistance in the Senate confirmation process, which has become an important factor in the current political environment.
Wall Street is closely watching the market impact of this nomination. Investors generally believe that the ability of the Federal Reserve Chair to achieve inflation targets while resisting political interference is a key factor for global financial stability. If the new chair is viewed by the market as more politically influenced, it could lead to fluctuations in the bond market and pose pressure on the long-term trend of the dollar.
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Original: toutiao.com/article/7597353333388509702/
Statement: The article represents the personal views of the author.