President Trump, “the Fed is the problem, must lower rates.”
US President Donald Trump renewed his criticism of the Fed Tuesday, describing the central bank as a “problem” as he called for lower interest rates.
The latest Presidential assault on the nation’s monetary authority comes as stocks dive on concerns ranging from slower global growth, uncertainty about interest rates, and what is viewed by some analysts, as a widening trade dispute between the US-China.
A home-builder survey this week indicated the housing market is slowing further amid the highest mortgage rates in eight years, a possible warning sign for the broader economy.
“I’d like to see the Fed with a lower interest rate,” President Trump told reporters in Washington. “We have much more of a Fed problem than we do with anyone else.”
The Fed held borrowing costs steady at its meeting earlier this month but investors expect it to raise rates in December, which would mark the 4th interest rate hike since President Trump-appointed Jerome Powell became Chairman in February.
President Trump in the past has blamed the “loco” Fed for causing steep stock-market losses with its campaign of gradual rate increases and demurred on whether he would fire Chairman Powell. The President’s criticism broke with a 2-decade White House tradition of avoiding comment on monetary policy out of respect for the Fed independence.
US central bankers are trying to keep the world’s largest economy on an even keel and inflation near their 2% target amid a strong labor market that has driven unemployment to the lowest level since Y 1969. They have signaled in another rate increase by year-end and 3 more in Y 2019, according to Quarterly projections from September that will be updated next month.
Economic growth is forecast to moderate following the best back-to-back Quarters since Y 2014
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