The Biden administration has reaffirmed its support for an autonomous Federal Reserve amid reports of former President Donald Trump‘s intentions to influence U.S. monetary policy.

What Happened: The White House Council for Economic Advisors underlined the importance of central bank independence in a blog post on Wednesday, as reported by Reuters. The CEA highlighted the historical evidence suggesting that central banks under political control perform poorly, while independent central banks are more effective in managing inflation.

The CEA blog post stated, “We in the Biden administration are highly motivated by this history and will continue our unwavering support for CBI (central bank independence).”

The post also emphasized the role of an independent Fed in curbing inflation, a viewpoint that has been consistently supported by economists and Fed officials, including Chairman Jerome Powell.

Trump, during his presidency, appointed Powell as the head of the Fed. However, he later expressed dissatisfaction with the central bank’s decision not to lower interest rates to stimulate the economy. Trump has also criticized current President Joe Biden for the persistent high inflation and suggested that Powell might reduce interest rates to aid Biden’s re-election.

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Why It Matters: The Federal Reserve’s independence has been a topic of concern amidst the U.S. presidential election. Market experts have questioned Powell’s ability to remain free from political pressure, especially with the election looming. This has raised doubts about the Fed’s ability to decide solely based on economic factors.

Meanwhile, the issue of the Fed’s independence has also been brought to the fore by Republican lawmakers. In a move to address the issue of inflation, Rep. Thomas Massie (R-Ky.) introduced a bill to abolish the Federal Reserve, stating that Americans would be better off without it. This bill, known as the “End the Fed” bill, aims to eliminate the Federal Reserve, which Massie claims devalues the currency and causes inflation.

Furthermore, the Fed’s potential rate cuts have also been a point of concern. Investment strategist Ed Yardeni has warned that a rate cut by the Fed could trigger a stock market “melt-up,” potentially propelling the S&P 500 to record highs by the year’s end.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote