White House calls for Fed to reverse US rate hikes
U.S. President Donald Trump said on March 29 that the Federal Reserve made a mistake by raising interest rates and blamed the central bank for hurting the U.S. economy and stock market.
"Had the Fed not mistakenly raised interest rates, especially since there is very little inflation, and had they not done the ridiculously timed quantitative tightening, the 3.0 percent GDP, Stock Market, would have both been much higher World Markets would be in a better place!," Trump tweeted.
The remarks were part of a new attack the White House has launched against the independent central bank in their unusual public split. The Fed's Board of Governors did not immediately comment.
No fewer than five Fed officials this week have touted the underlying strength of the American economy and argued a recent spate of weak data on business activity is more likely to prove fleeting than lasting. None said they currently back a rate cut.
Prior administrations have taken care not to comment on Fed policy, but Trump has railed repeatedly against the U.S. central bank's rate hikes. His comments were uniquely specific about the course of action now favored by the president.
The president's top economic adviser said the White House would like the Fed to reverse some recent rate hikes and stop shrinking its bond holdings to protect the U.S. economy from weakness overseas. Some Fed policymakers and other economists have credited U.S.-China trade tensions or tariffs under the current administration as a factor behind the slowdown and market swings.
"This is our view. This is his view. This is my view," National Economic Council Director Larry Kudlow told CNBC on March 29, confirming that he had told news website Axios that he would like the Fed to cut rates by a half-percentage point and stop cutting its bond holdings.
"The Federal Reserve is an independent central bank. They're going to do what they're going to do."