Former US Treasury Secretary Summers warns that any President's influence on US monetary policy formulation will ultimately harm the economy.

Summers said on Bloomberg TV's "Wall Street Week" program last Friday, "Involving politicians is a foolish game," and "the ultimate result is higher inflation and weaker economy."

On the day before Summers delivered his speech, Republican presidential candidate Trump said he strongly believes the President should have some "speaking rights" in the formulation of Fed policy.

Trump, when he was in office, urged Chairman Powell to loosen policy, claiming that policy formulation was a "hunch," and that he himself had better "hunches" than the Fed Chairman and other senior officials in many cases.

Summers, a current Harvard professor and Bloomberg Television paid contributor, said of Trump's suggestion: "I'm really shocked, what a terrible idea."

"At any time, the President has a lot to do, in fact, his understanding of the economy is far less than the 19 members of the Federal Open Market Committee who focus on scrutinizing every economic statistic," he said.

The Trump campaign team did not immediately respond to requests for comment.

Summers stressed that over time, countries around the world have recognized that there are "profound interests conflicts" among politicians in monetary policy, so they have given central banks independence.

He pointed out that government officials "always want to print more money, lower interest rates - step on the gas pedal, in order to boost the economy." This pressure raises people's expectations of inflation and pushes up long-term interest rates. Summers has held senior economic positions in the Democratic governments of Bill Clinton and Barack Obama.

"He believes that such practices by government officials will only" aggravate inflation, without substantial growth in output.

Summers cited the example of former US President Richard Nixon, who is famous for pushing then-Fed Chairman Arthur Burns to implement a loose monetary policy in the early 1970s, triggering a costly inflationary cycle. He also mentioned "countless" cases in Latin America where many economies have turned to independent central banks in recent years to curb inflation.

As for the Fed's current policy decision, Summers said that given the easing of market volatility and stock market selling since the turmoil since last Monday, "based on current facts," any emergency rate cut is unnecessary.

He said: "Emergency response will be hasty, panic, overheated, and counterproductive." However, he also believes that a 50 basis point rate cut may be appropriate at the policy meeting in September.

Powell previously said at a press conference after the July rate decision that a significant rate cut "is not currently something we are considering."

Editor/ping