Germany’s finance minister has criticised Donald Trump’s move to interfere with the Federal Reserve’s rate policies and fire a chief statistician, saying the US president’s actions were politically “wrong”.
Speaking a few hours before meeting with his US counterpart Scott Bessent in Washington, Lars Klingbeil said he believed democracies should “uphold the independence and strength of institutions”.
He added of Trump’s interference: “I think this political path is wrong, and I believe it’s right that independent institutions remain independent and that politics doesn’t interfere.”
The criticism from Europe’s largest economy comes after Trump’s decision to sack the chief of the Bureau of Labor Statistics last week following the release of disappointing economic data. The US president has also been infuriated by the Fed’s unwillingness to aggressively lower interest rates and has openly been seeking to remove its chair Jay Powell.
Bessent has also suggested there was room to cut US borrowing costs and has called for a probe into the Fed and whether it has strayed “beyond its core mission”.
Klingbeil’s comments underline the delicate balancing act for Europe’s politicians at a sensitive time for the transatlantic relationship under an adversarial Trump administration. The EU is still reeling from a trade agreement that will see the US impose 15 per cent tariffs on EU imports. Export-heavy Germany, and its already struggling car manufacturing sector, is most exposed to these higher tariffs.
In Brussels and throughout the EU, initial relief at the prospect of avoiding even more punitive tariffs of 30 per cent Trump had threatened has since been replaced by acrimony and confusion. The European Commission is still seeking clarity over the fate of steel imports and exemptions for the EU pharmaceutical sector.
Klingbeil, who is also vice-chancellor in the coalition led by Friedrich Merz, on Monday said he would discuss the EU-US trade deal and push for quotas on steel imports from the EU, which could be exempted from tariffs.
“It is important that the uncertainties of recent months are eliminated and that there is now security for companies on both sides of the Atlantic as well,” Klingbeil said. “And yet there are still a few things that need to be spelled out that are unclear, for example when it comes to the question of what’s next in the steel sector.”
The German minister said that one topic he would discuss with Bessent will involve potential higher tariffs on “cheap Chinese goods flooding” the EU and US markets.
Washington and Beijing have also been locked in trade negotiations and economists have suggested that higher US tariffs on Chinese goods would prompt Chinese exporters to target the EU market instead.
“We are currently considering how we can change the customs rules and how we can also charge more tariffs,” Klingbeil said.
Additional reporting by Claire Jones
