Donald Trump: US President demands "interest rates down to zero or less"
Interest rates in the US are too high, says Donald Trump. Shortly before the decisive meeting, he urges the "stupid heads" in the Fed and their boss to action.
A few days before the Fed meeting, US President Donald Trump is pushing for a drastic cut in interest rates. They should be capped to zero or less, he tweeted. The US should, in his view, have the lowest interest rates. It is only due to the "naivety" of Fed Chairman Jerome Powell and the Fed that the United States did not follow the low interest rate model of other states, writes the president.
Zero, or less, and we should then start refinancing our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power and balance sheet .....- Donald J. Trump (@realDonaldTrump) September 11, 2019
Trump repeats his attacks on the central bank, which he has been urging for a long time to finally bring interest rates down to make it easier for the government to repay its debts. It was up to Powell alone, Trump said in his tweet, that the US could not do what other countries already did. The United States missed the unique opportunity to repatriate too much cheaper interest because of "fools".
High interest rates not only because of the Fed
Powell, who has been directly attacked by the president in recent weeks, meanwhile refers to the independence of the institution she leads. He recently let Trump know that the Fed is committed to "all Americans" in its monetary policy, not individual parties.
In fact, the US has a fairly high level of interest rates compared with other developed countries. That is only partly due to the Fed. Other factors that argue for higher US capital market rates are higher economic growth and higher inflation.
However, many analysts expect the Fed to continue its policy of easing that started in the summer and cut interest rates again by a quarter point next Wednesday. It is currently in a range of 2.0 to 2.25 percent.