Chicago Fed's Goolsbee Rejects Rate Cuts to Ease US Debt Costs, Citing Independence

Chicago Fed President Austan Goolsbee said on September 21, 2026, that the Federal Reserve should not lower interest rates to help the US government finance its debt and deficits, arguing that doing so would undermine central bank independence. Speaking to reporters in London, Goolsbee called the "monetize the debt" argument the "canonical" case for Fed independence, warning that forcing rates lower to reduce deficit costs would likely fuel inflation and push market borrowing rates higher. His remarks come after President Donald Trump suggested the Fed cut its policy rate to about 1%, well below the current 3.75%-4.00% range. US long-term borrowing costs have risen recently, adding to the expense of financing annual deficits running at roughly 6% of economic output.