TO Donald Trump He did not like at all the 50 basis point rate cut taken by the Federal Reserve (Fed). Or at least that is what his statements suggest, as he claims that the agency’s decision shows that the US economy is in “very bad shape” or that the Central Bank is “playing politics.”
“I guess the big cuts show that the economy is in very bad shape, assuming they’re not playing politics. The economy is in very bad shape, or they’re playing politics, one thing or the other. But it was a big cut,” the former president and Republican candidate for the White House told the media.
TO Less than two months to go before the US electionswhich will take place on November 5th, this This is not the first time that Trump has accused the Fed of acting politically or criticized the head of the agency, Jerome Powell.
In fact, in an interview with Bloomberg News over the summer, the Republican candidate already warned Powell not to cut interest rates before the election, although he added that if he returned to the White House would let Powell serve out the remainder of his term at the Fed if he was “doing the right thing.”
Still, despite nominating Powell to serve as Fed chairman in 2017, Trump repeatedly criticized him for failing to lower rates to avoid the overheating of the economy. Powell’s current term as chairman (he was reappointed by President Joe Biden in 2021) will end in 2026.
Powell’s denial of political influence
The president of the US Federal Reserve (Fed), Jerome Powellsaid that when making decisions about rate cuts, the presidential elections on November 5 are not a variable to be taken into account.
“Our job is to support the economy on behalf of the American people. If we get this right, it will benefit the American people in significant ways. We focus on this“he said at a press conference after the regulator announced a rate cut for the first time in four and a half years, this time by half a point.
Before the presidential election, the Federal Open Market Committee (FOMC), which is responsible for making that decision, has no further meetings scheduled: these will be on November 6 and 7, immediately after the election, and on December 17 and 18.
Tuesday and Wednesday were therefore the last meeting before the US vice president and Democratic candidate, Kamala Harris, and the former Republican president Donald Trump (2017-2021) face each other at the polls.
But Powell made it clear that the decisive date had no influence on the step taken: “We did not apply any other filter,” he told reporters.
Source: Ambito
