Goolsbee: Fed shouldn't use rates to make government finance cheaper, that's a key argument for independence

WASHINGTON, Dec 12 (Reuters) - Chicago Fed President Austan Goolsbee said Friday the central bank should not factor the cost of government finance into its interest rates deliberations, citing that as a key reason Fed independence is so important.

"It pains me that people are legitimately saying...why should a group of people outside the government, outside the administration, be deciding the interest rate? They shouldn't be independent," Goolbsee said at a Chicago Fed economic symposium. "You have some even making the argument that the Fed should lower rates so that it will be cheaper to float the debt. That's monetizing the debt. That's the canonical reason why you want the Fed to be independent."

President Donald Trump has said the Fed should lower interest rates to lower the cost of government borrowing.