Fed Chair Jerome Powell Grapples With Record Low Confidence Levels Amid Escalating Financial Worries

Zinger Key Points
  • The percentage of U.S. adults with a great deal or fair amount of confidence in Jerome Powell fell to 36%, the lowest on record.
  • Following the Fed's quickest rate rise cycle in its history, US citizens appear to be opposing Powell.

American citizens' trust in Federal Reserve Chair Jerome Powell has reached an all-time low, dipping below the trust levels of any other Fed Chair in history, according Gallup survey released Tuesday. The data comes at a time when insurance costs for U.S. debt default risk hit their highest since 2009. 

What To Know: The percentage of U.S. adults with a great deal or fair amount of confidence in the current Fed Chair fell from 43% in 2022 to 36% in 2023, the lowest ever recorded since the series began. 

Powell achieved the highest level of trust among Americans (58%) in 2020, when the Federal Reserve lowered interest rates to their lowest level since the Great Financial Crisis.

Also Read: Mitch McConnell Rules Out Helping Joe Biden On Debt Ceiling Crisis: 'They're Assuming There's Some Little Secret Plan Here'

The previous lowest level of trust in a Fed chair was 36% in 2016, when the Fed chair was Janet Yellen, who is now the head of the U.S. Treasury. Alan Greenspan achieved the highest level of trust in 2001, when 74% of respondents expressed confidence in the Fed chair.

Why It Matters: A lack of faith in Powell comes after the central bank delivered its quickest rate cycle in history, raising the Fed funds rate to 5-5.25% to combat multi-decade high inflation, and may signal some skepticism about the Fed's capacity to bring inflation back to target and stimulate growth.

A lack of trust in a central banker may endanger the U.S. dollar's value versus real assets such as gold, which tends to thrive during periods of negative sentiment about the financial future.

The SPDR Gold Trust GLD is currently trading just 2.2% off its all-time highs. 

Read Next: Where's Gold Headed Amid Inflation, Banking Jitters? Analyst Predicts Possible Levels

Photo: Courtesy of Federal Reserve

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