Plenty of people have a bone to pick with Reserve Bank governor Michele Bullock: interest rates being too high, interest rates being too low…and a perpetual sense that economists at the bank can never quite seem to get all their forecasts right.

Even so, most people would prefer the Reserve Bank governor and the RBA’s board setting interest rates rather than the prime minister or treasurer. And they’d prefer the Reserve Bank boss to be able to make her own calls than bow to the will of politicians who are too often concerned with people-pleasing.

Donald Trump may not be a “people pleaser” in that he seems to do whatever he wants (and often gets away with it). But he’s not immune from feeling the wrath of his voters, and he knows one of the biggest grievances for Americans continues to be cost of living.

Donald Trump’s tariff policies have created uncertainty for the RBA and governor Michele Bullock.

Trump’s pre-election promise to “bring down the prices of all goods” is almost certainly doomed. For a start, price growth can slow, but rarely does it go backwards. And many of the tariffs that he imposed last year will make the cost of imported goods into the US more expensive.

The quick solution, in Trump’s view, is to bring down borrowing costs by lowering interest rates. The problem? Well, ignoring for a second the worsening effect this will actually have on inflation, that’s why the chair of the Federal Reserve (the US central bank) Jerome Powell refuses to bow to pressure.

In what has become one of Trump’s signature moves when people put up a fight against him, he is going after Powell through the justice system: launching, on Sunday, a criminal investigation into a separate issue about the renovation of the Federal Reserve’s headquarters in Washington.

Rather quickly (and unusually) Powell called out the president’s bulldust. In a rare video message, he said Trump’s threat was not about the renovation at all, but a continuation of the pressure the president had been mounting on the Federal Reserve for some time to get it to lower........

© The Sydney Morning Herald