Trump says US interest rates should be lowest in world
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President Donald Trump said on Sunday the US should have the world's lowest interest rates, days before the Federal Reserve is expected to raise them. His call follows hotter-than-expected August inflation and a strong jobs report, with traders pricing an 86% chance of a hike on Wednesday. The pressure comes as Fed Chair Kevin Warsh faces a decision that could reignite debate over his motivations.
Key Facts
- Trump said on Sunday the US should have the world's lowest interest rates.
- Traders see an 86% chance the Federal Reserve raises rates on Wednesday.
- August US inflation came in hotter than expected, and the jobs report was unexpectedly strong.
- Fed Chair Kevin Warsh reiterated the central bank's 2% inflation target last month.
Trump's Pressure
President Donald Trump said on Sunday that the US should have the world's lowest interest rates. His statement piles pressure on Federal Reserve Chair Kevin Warsh days before the bank is expected to raise rates. Trump's call comes after a hotter-than-expected US inflation reading for August and an unexpectedly strong jobs report.
Fed Decision
Traders say there is an 86% chance of a rate increase on Wednesday. Warsh reiterated the bank's 2% inflation target last month. A CNBC analyst wrote that Warsh is now in a position to either vindicate his own views or reignite debate about what is truly motivating him. That uncertainty would likely raise the yield on long-term debt, the analyst added.
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