Recently released Federal Reserve schedules show that two Fed officials met banking-industry figures or attended related events during the quiet period around Federal Open Market Committee (FOMC) meetings in May and June. There is no evidence in the records that they broke the Fed’s communications rules, but the timing is unusual.
Bowman met with a bankers association executive
Michelle Bowman, the Fed’s vice chair for supervision, had a meeting with the head of the Massachusetts Bankers Association in the week before the June 16-17 FOMC meeting, according to her schedule. A Fed spokesperson said the meeting was preparation for a public speech she delivered to the group a week after the FOMC meeting.
Powell attended a Bank of New York Mellon reception
Jerome Powell, identified in the source text as a former Federal Reserve chair, attended a reception hosted by Bank of New York Mellon’s global board on June 9, also one week before the FOMC meeting. A Fed spokesperson said Powell attended as an invited guest and did not speak at the event.
Bloomberg requested the schedules from the Fed in July, and the central bank released them late Friday.
What the quiet-period rules say
Under the rules, Fed officials may not publicly discuss their views on the economy or monetary policy starting roughly a week and a half before an FOMC meeting and continuing through the day after the meeting ends. Even outside that period, officials may not disclose such views in private settings unless they are repeating remarks that have already been made public.
Contact with outside parties before or after an FOMC decision is not automatically a violation. Still, meetings with bankers or the public during that window are not common.
The release came as Trump renewed pressure on the Fed
The disclosure landed as Donald Trump stepped up pressure on the central bank again.
After Kevin Warsh replaced Powell as Fed chair this year, Trump had reduced his public pressure campaign for a time. The latest developments suggest that pressure is returning. At the same time, Trump’s approval ratings have fallen noticeably ahead of the November midterm elections, with polls showing voter dissatisfaction over living costs and his handling of the Iran war.
U.S. nonfarm payrolls unexpectedly rose by 162,000 in August, while the unemployment rate held steady. Investors then increased bets on a rate hike at the Fed’s next meeting, pushing down U.S. stocks and short-dated Treasury prices.
Trump responded by criticizing the market decline. He said the stock market "should go up" because jobs data were strong and credit and economic conditions were good, but instead it fell because of inflation worries.
White House chief economic adviser Kevin Hassett took a less aggressive line the same day. Hassett said strong jobs data strengthened the case for keeping rates unchanged and said, "We respect the Fed’s independence, but I think the case for holding rates steady will be quite strong."
Bowman had already faced questions over a private dinner
Bowman had already drawn scrutiny over a private dinner during the quiet period.
Bloomberg and other outlets had previously reported that Bowman attended a private dinner hosted by Bank of America in New York several hours after the June FOMC meeting ended. Bowman later said she did not discuss her monetary policy stance at the dinner and added that she had "always complied with all applicable FOMC rules and ethical standards" and would continue to do so.
That dinner later prompted U.S. Senator Elizabeth Warren to call on the Federal Reserve inspector general’s office to open an investigation.
Another June 17 meeting appeared on Bowman’s schedule
Bowman’s June 17 schedule also showed that she met with Republican Senator Bill Hagerty of Tennessee about an hour after that day’s FOMC meeting ended and before the rate decision had been released publicly.
Fed officials are allowed to communicate with government officials during the quiet period, including discussions involving nonpublic information. They may not disclose confidential FOMC information without written authorization from the chair.
Fed says two May events were tied to supervision work
Bowman’s schedule also showed that she took part in a roundtable at the Colorado Forum on May 7 and attended another roundtable hosted by the New Hampshire and Vermont Bankers Associations on May 14.
A Fed spokesperson said both events were listening sessions related to supervisory matters and did not involve discussion of monetary policy.