Trump in unusual criticism of U.S. central bank

Trump in unusual criticism of U.S. central bank

Trump in unusual criticism of U.S. central bank

"I really like President Xi a lot, but it was very unfair".

Earlier today, Mr Trump tweeted: "China, the European Union and others have been manipulating their currencies and interest rates lower, while the raising rates while the dollars gets stronger and stronger with each passing day - taking away our big competitive edge". Trump complained that China's currency is "dropping like a rock".

"I'm not thrilled. Because we go up and every time you go up they want to raise rates again".

At the same time, Brazil and Argentina, another major soybean grower, have snapped up some of the cheap United States supplies for their domestic markets, according to Grant Kimberley from the Iowa Soybean Association. "I want them to do well", he said.

In February, Jerome Powell, Trump's hand-picked choice, became Fed chairperson.

But one JPMorgan economists thinks Trump's public desire for lower interest rates could actually backfire.

Mr. Powell argues that the economy is strong enough to handle higher rates after the rates were kept artificially low to help the recovery from the Great Recession of 2007.

The Fed has raised interest rates five times since Trump took office in January 2017, extending the campaign it began in 2015.

Some of the numbers in the video may be in dispute, but the potential of devastating losses to United States farmers is a concern voiced by many agricultural groups and their representatives. CNBC calls the rebuke "stinging and historically rare criticism", noting that presidents typically don't intercede with Fed affairs.

The Fed has raised interest rates twice in 2018, and is expected to issue at least two more rate hikes before the end of the year.

Put another way: The best way for the Fed to assert its independence is to do exactly the opposite of what Trump suggested.

It's what allowed the Fed to take emergency measures in the past, without fear of political meddling, such as in 2008 when it undertook an aggressive policy known as quantitative easing, whereby it bought massive amounts of debt to create new money out of nothing, to stimulate the economy. Is a currency war coming? Both Bush administrations, and the Clinton administration that came between them, squabbled with chair Alan Greenspan, who's time atop the Fed saw the central bank make a long series of aggressive hikes and cuts between 1987 and 2006, when he was replaced by Ben Bernanke.

"This puts Powell in the very awkward position", Valliere said, "of having to show the market that he's tough on inflation".

For two straight days, President Donald Trump has committed a major break in American political convention by commenting on the actions of the Federal Reserve and the criticism echoes one of the worst monetary-policy mistakes in U.S. history.

TRT World's William Denselow reports from NY.

Trump had a love-hate relationship with former Fed chief Janet Yellen.

Asked about the prospect of a stock market plunge in response to larger-scale tariffs, Trump said: "Well, if it does, it does".

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