Just two days ahead of an interest rate decision, U.S. President Donald Trump is already lambasting the Federal Reserve for what the capital markets are widely expecting, which is a fourth and final rate hike to end 2018.
As has been the norm whenever denigrating the central bank, President Trump took to Twitter to sound off on the economy. This time, the president cited a strong dollar and inflation as reasons to curb further rate hikes.
It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning and China way down, the Fed is even considering yet another interest rate hike. Take the Victory!
— Donald J. Trump (@realDonaldTrump) December 17, 2018
Rate hikes have been anathema to President Trump, and with the Dow Jones Industrial Average down 2.73 percent year-to-date even after a historic bull run that saw companies like Apple and Amazon cross $1 trillion in market capitalization, the mercurial president has been quick to deride the Fed whenever the markets react negatively. On Monday, the Dow started the week’s trading session down over 200 points.
Trump Uses Fed Chair as Punching Bag
Since taking office, President Trump has been flicking jabs at Federal Reserve Chairman Jerome Powell for raising interest rates–the same man he nominated for the position. Trump has been leading the chorus on economic growth, taking the opportunity, when presented, to remind everyone that the strong data being extrapolated from the economy is coming under the helm of his presidency.
As far as debates go as to who deserves more credit–the former administration under Barack Obama or the current one under Trump–the president made it clear who deserves the majority, if not all, the credit.
“Barack Obama talked a lot about hope, but Donald Trump delivered the American Dream. All the economic indicators, what’s happening overseas, Donald Trump has proven to be far more successful than Barack Obama. President Trump is delivering the American Dream.” Jason Chaffetz
— Donald J. Trump (@realDonaldTrump) September 9, 2018
‘Not Happy’ with Raising Rates
Since January 2017 when President Trump took office, the Federal Reserve has now hiked interest rates six times versus just once during former president Barack Obama’s tenure. With major stock market indexes like the S&P 500 reaching historic highs with companies like Apple and Amazon crossing the $1 trillion valuation mark, the prevailing sentiment is that another rate hike is to come before the end of 2018 and possibly three or more forecasted for 2019.
Following the latest rate hike announcement in September that the Fed would be raising the federal funds rate by 25 basis points to 2.25, Trump took the opportunity at a New York press conference to express his discontent.