Bank of America CEO warns that the market's excessive focus on the Federal Reserve is "misplaced"

DeepFlowTech · 2025-12-30T08:50:42+00:00

Bank of America CEO Brian Moynihan warned on CBS that the market's focus on the Federal Reserve is overly intense, emphasizing that the U.S. economy is primarily driven by the private sector and noting that the Fed should not influence the economy during normal times. He also mentioned that if the Fed loses its independence, the market could be punished.

DeepFlowTech

2025-12-30 08:50:42

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Deep Tide TechFlow News, on December 30th, U.S. Federal Reserve Chairman Brian Moynihan warned on CBS News program “Face the Nation” that the market’s focus on the Federal Reserve has “gone overboard.” He emphasized that the U.S. economy is primarily driven by the private sector, not the Fed’s interest rate adjustments, stating, “The idea that our fate depends on the Fed adjusting interest rates by 25 basis points is, in my opinion, completely chaotic.”

Moynihan acknowledged that the Fed plays a key role during extreme situations like financial crises and pandemics but stated that during normal times, “people shouldn’t really feel its presence.” He also warned that if the Fed loses its independence, the market will punish it.

The background is Trump’s ongoing demands for larger rate cuts and pressure on the Fed. Capital Economics predicts that, due to core inflation remaining above the 2% target for a long time, the Fed may only cut interest rates by 25 basis points in 2026, which will almost immediately lead to a confrontation between Trump and the newly appointed Fed Chair he endorses.

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