Trump calls the Fed’s rate cut “pretty small” and could have been “twice as much”
The president of the United States, Donald Trump, considered this Wednesday that the quarter-point interest rate cut announced by the Federal Reserve (Fed), which leaves them between 3.5% and 3.75%, It’s “quite small” and that it could have been “double.” “They are afraid of inflation,” he said during a round table with executive directors at the White House.
Trump has blamed the Federal Reserve for harming economic growth by keeping interest rates higher than he would like. “That’s what they’re doing: they are killing growth“, denounced the Republican, who has described the president of the Fed, Jerome Powell, as “rigid.”
In addition, the US president has announced that he will meet with former Federal Reserve Governor Kevin Warsh this Wednesday. Warsh and National Economic Council Director Kevin Hassett are two of the leading candidates to succeed Powell when his term ends in May. “I’m looking for someone who is honest with interest rates”Trump has noted.
The reduction in the price of money has had three votes against, one more than at the October meeting, after Stephen Miran argued for a half-point decrease against the majority. On the contrary, Kansas Fed Governor Jeffrey Schmid and Chicago Fed Governor Austan Goolsbee have defended keeping rates unchanged.
Powell has assured that the discrepancies are the result of “unusual” shock of upward risks for inflation and downward risks for the labor market. “The persistence of this tension is very unusual. […] The debates we have are as productive as any we have had in my 14 years at the Fed. They are very serious, respectful and with people with strong convictions. […] Today we have made a decision. Nine of the 12 members supported it. So there has been quite broad support,” he highlighted at a press conference.
