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President Donald Trump says he has no intention of ending his public attacks on the Federal Reserve’s interest rate policies even though he knows he has made Chairman Jerome Powell’s job more difficult.
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Trump tells ABC News that he thinks economic growth and stock market indexes would be substantially higher if the chairman “wouldn’t have raised interest rates so much.” The Fed raised rates four times last year.
Again this week, Trump bashed the Fed saying “They don’t have a clue!” as he blamed the Fed for a rising dollar and weaker international currencies.
Even so, Powell has signaled that the Fed is prepared to cut rates should it decide that Trump’s trade war with China threatened the economic expansion.
“We do not know how or when these issues will be resolved. We are closely monitoring the implications of these developments for the U.S. economic outlook and, as always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2 percent objective,” he said in a speech earlier this month. Many investors interpreted the comments as a doveish sign.
The Fed has long sought to operate free of political influence to maintain credibility as the world’s leading central bank. Powell, whom Trump elevated to chairman, has said before that he wouldn’t resign despite pressure from Trump.