U.S. President Donald Trump on Friday called on the Federal Reserve to cut interest rates, saying the strength of the U.S. economy justified lower borrowing costs, and warned that he could halt trade with countries with which the United States runs a deficit.
Trump made the remarks in posts on his Truth Social platform after a stronger-than-expected monthly jobs report, directing his criticism at the central bank and its chairman, Kevin Warsh.
“Lower the interest rates because the U.S.A. is a much stronger credit than it was just a short time ago!” Trump said.
“A strong country means a lower interest rate — it’s a better credit,” he added.
Trump said the United States should have the world's lowest interest rate, arguing that high borrowing costs put the country at an unfair disadvantage.
He also tied his demand for lower rates to his long-running criticism of U.S. trade deficits.
“Lower the rate or I’ll stop trading with countries with which we have a deficit,” Trump said, adding that such a move would be “better than tariffs”.
The warning comes as Trump's administration continues to use tariffs and other trade measures as part of its efforts to reduce the U.S. trade deficit.
Trump also criticised a recent Supreme Court decision on tariffs and called on the Fed's board to act in what he described as the country's interests.
“The Fed Board, with its great new leader, must get smart — be patriots for a change,” Trump said.
“High interest rates put the U.S.A. at a very unfair disadvantage, and I won’t allow that to happen!” he added.
In a later post, Trump continued his criticism of the Fed, arguing that strong economic data should have lifted financial markets rather than raised concerns about inflation.
“Growth does not cause inflation!” he said.
Trump said the U.S. economy should be growing at annual rates of 15 per cent or 20 per cent, rather than the 2 per cent, 3 per cent or 4 per cent rates typically associated with strong economic expansion.
He argued that faster growth would help the United States tackle its debt and strengthen its financial position.
The comments underscore Trump's continued pressure on the Federal Reserve to reduce borrowing costs, despite the central bank's mandate to set monetary policy independently of the White House.
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