Partisan Trust in the Federal Reserve

Carola Binder, Cody Couture and Abhiprerna Smit

No 33684, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper examines partisanship in public perceptions of the Federal Reserve. In all years from 2001 through 2023, trust in the Federal Reserve was highest for respondents of the same party as the President. The partisan effects were larger than other demographic differences in trust, but do not explain the large partisan gap in inflation expectations in those years. We conducted a new survey-based information experiment before and after the Presidential inauguration in 2025, and found a changed pattern: Republicans continued to have lower trust in the Fed than did Democrats, even after a Republican President was elected and took office. Yet, Republicans had much lower inflation expectations than Democrats. Responses to open-ended survey questions point to tariffs and President Trump himself as most salient to consumers when considering how inflation will evolve.

JEL-codes: E02 E03 E30 E5 E51 E58 (search for similar items in EconPapers)
Date: 2025-04
Note: ME
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