President TrumpDonald John TrumpChinese, US negotiators fine tuning details of trade agreement: report Iran wants America out of Iraq; will it succeed? Florida bar reverses no-hat policy after objections from MAGA hat wearer MORE hammered the Federal Reserve on Friday for “mistakenly” raising interest rates, arguing that domestic and international markets would be stronger had it not done so.
“Had the Fed not mistakenly raised interest rates, especially since there is very little inflation, and had they not done the ridiculously timed quantitative tightening, the 3.0% GDP, & Stock Market, would have both been much higher & World Markets would be in a better place!” Trump tweeted.
Had the Fed not mistakenly raised interest rates, especially since there is very little inflation, and had they not done the ridiculously timed quantitative tightening, the 3.0% GDP, & Stock Market, would have both been much higher & World Markets would be in a better place!
— Donald J. Trump (@realDonaldTrump) March 29, 2019
The tweet represented Trump’s latest salvo against the Fed, with the president repeatedly hammering the central bank for hiking interest rates, which it did four times in 2018.
“No, I think the Fed is making a mistake. They’re so tight,” Trump said in October over a string of planned interest rate increase. “I think the Fed has gone crazy. So you can say that, ‘Well that’s a lot of safety actually.’ And it is a lot of safety, and it gives you a lot of margin. But I think the Fed has gone crazy.”
“If we didn’t have somebody raising interest rates and do quantitative tightening we would have been over 4 [percent] instead of at 3.1 [percent]” in terms of economic growth, Trump told Fox Business in an interview that aired last week. “The world is slowing, but we’re not slowing.”
In a sign administration officials are feeling pressure from the Oval Office to heed Trump’s demands, White House economic adviser Larry Kudlow called on the Fed to “immediately” cut interest rates by 50 basis points.
“I am echoing the president’s view — he’s not been bashful about that view — he would also like the Fed to cease shrinking its balance sheet. And I concur with that view,” Kudlow told CNBC on Friday.
“Looking at some of the indicators — I mean the economy looks fundamentally quite healthy, we just don’t want that threat,” he added. “There’s no inflation out there, so I think the Fed’s actions were probably overdone.”
Federal Reserve Chairman Jerome Powell said last week that the bank will not raise interest rates for the second consecutive month and lowered its outlook on rate hikes to zero for the year, citing the Fed’s “positive” outlook on the U.S. economy.
The Fed’s interest rates are currently at 2.25 percent to 2.5 percent. A 50-point basis cut could push rates below 2 percent.