Three Types of Agreements Between the Fed and the Treasury

The Federal Reserve’s Unprecedented Year

In 2025, the Federal Reserve faced a political climate unlike any it had encountered before. In my view, it was the most difficult period for the central bank since its inception, with the possible exception of the early 1950s. Back then, President Harry Truman, under immense political pressure and dealing with both the threat of war and an unstable economy verging on stagflation, made the Fed a central concern of his administration. This intense focus led to the landmark Fed-Treasury Accord of March 1951, a pivotal event in the institution’s history.