President Donald Trump on Tuesday escalated his assault on the Federal Reserve, calling it “my biggest threat.”
“Because the Fed is raising rates too fast. And it’s independent, so I don’t speak to him. But I’m not happy with what he’s doing because it’s going too fast. Because – you look at the last inflation numbers, they’re very low,” Trump said in an interview with Fox Business.
Trump has repeatedly attacked the Fed, saying the central bank has “gone crazy,” blaming Chairman Jerome Powell for last week’s massive drop in stocks and declaring he was “not happy” with Powell’s “loco” decision to continue raising interest rates.
“I’m not blaming anybody, I put him there,” Trump said of Powell. “And maybe it’s right, maybe it’s wrong. But I put him there.”
Although Trump has repeatedly said he believes the Fed is “making a mistake” with its monetary policy, he also has said he is “not going to fire” Powell. Trump said in an Oct. 11 interview that he is “just disappointed” with Powell’s decisions.
The president’s latest attack again the central bank came just hours after the Labor Department reported that the number of job openings in the U.S. economy leaped to a record 7.1 million in August. That’s after the government reported earlier in the month that the unemployment rate in September dropped to 3.7 percent, the lowest level in nearly 50 years.
The recent economic data helped the Fed’s policy-making arm defend its increase to the federal funds rate in September – which was the such third quarter-point bump this year.
Both the Fed and markets anticipate a fourth rate hike in December. But Trump has continued to vocalize his disagreements with the Fed and that’s led some to fear that the institution’s independence is at risk. U.S. officials say Trump is honoring the Fed’s historic ability to make decisions outside of political interference. Former Fed Chair Janet Yellen said on Friday that she believes the Fed will continue with its economic strategy, even with Trump’s open criticism.
“The Fed is certainly not crazy in terms of what it’s doing,” Yellen reportedly said at the World Knowledge Forum.
– CNBC’s Tom Franck contributed to this report.
