Trump's Fed Pressure is 'Banana Republic Stuff,' Warns Harvard Economist Rogoff at Davos

• Kenneth Rogoff, Harvard Professor, warns at Davos 2026 that US institutional credibility, especially central bank independence, is under unprecedented strain from President Trump.
• Rogoff describes Trump's pressure on the US Federal Reserve as "banana republic stuff," comparing it to political interference in monetary policy seen in emerging markets.
• He notes that both political extremes in the US are uncomfortable with an independent Fed, with Trump seeking direct control for political ends and progressives wanting to expand its social remit.
• Rogoff suggests the Department of Justice scrutiny of the Fed is an intimidation tactic to reshape voting dynamics and provoke resignations, aiming to "take over the Fed."
• Despite the pressure, Rogoff doesn't predict runaway inflation but a "slow crawl" higher, a risk Trump might accept for political advantage, especially for midterm elections.

Why It Matters: Trump's political interference with the Fed and persistent tariffs threaten US institutional credibility and global financial stability.