The Guardian view on Trump v the US Fed: the bully pulpit | Editorial

The US central bank spent $29tn to stop the last financial crash. Donald Trump now wants it to bail out his presidency

Earlier this month Donald Trump accused the man he had appointed to run the United States Federal Reserve, Jerome Powell, of being an "enemy". His public dressing down of the central bank chair, who is supposed to be independent, was accompanied by further escalations of the US-China trade war. Mr Trump wants Mr Powell to lower rates to spur growth in the sputtering US economy and give him the upper hand with Beijing. This incompetence and bluster is hardly inspiring global confidence. It was a coincidence, however, that on the same day the Bank of England's governor, Mark Carney, warned the annual gathering of the world's central bankers that the global economy was becoming over-reliant on the dollar. That may have been fine when the US was viewed as a responsible leader of the world economy. Mr Carney plainly thinks that is not the case today.

There are reasons to worry. Almost every nation is tied to the monetary policy of the US. More than half of all trade invoices are in dollars, as are nine-tenths of all foreign exchange transactions. Since the 2008 global crash, corporate and government levels of dollar debt in the emerging world have rocketed, leading to financial instability. Despite the Trump administration's volatility and belligerence, the dollar keeps rising in value. It matters not that the US Fed cut rates in July: investors want to put their money into greenbacks. This is no new phenomenon: the US's "exorbitant privilege" was noted decades ago.