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Home / Business / Trump says the Fed should cut interest rates by at least 1% & # 39; with perhaps some quantitative easing & # 39;

Trump says the Fed should cut interest rates by at least 1% & # 39; with perhaps some quantitative easing & # 39;



President Donald Trump on Monday raised his demands on the Federal Reserve, requesting that the central bank reduce its interest rates by a full percentage point and restart its crisis printing program for the crisis.

In a couple of tweets again aimed at simplifying monetary policy, the president said the Fed has been hampered by a "terrible lack of vision" and said it should introduce 100 basis point reductions in the reference rate.

Criticizing the Fed is nothing new to Trump, who has voiced the desire for a weaker dollar and interest rates that are more competitive with other countries around the world. The Fed approved a quarterly cut at this July meeting, which has not prevented Trump from wanting more.

"Our dollar is so strong that it unfortunately harms other parts of the world," he said.

Trump has also shied away from what he calls "quantitative tightening", or the Fed's efforts to reduce the amount of bonds it held. The Fed acquired the assets during three rounds of purchases during and after the financial crisis, in an attempt to downgrade long-term interest rates and to steer money toward riskier assets such as equities and corporate bonds.

In previous shots at the Fed, he has argued that the Dow Jones industrial average would be 1

0,000 points higher and the economy would grow to better than a 4% interest rate if not for the rate hikes and the liquidation of the balance sheet.

His latest tweet again calls for "some" quantitative easing, which is sometimes referred to as "money printing", although it does not involve the actual creation of paper currency.

Markets expect the Fed to approve another 25 basis points at its September meeting, and probably one more by the end of the year.


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