Trump Complains About Rising Interest Rates, Calling the Fed 'My Biggest Threat'--2nd Update
October 16 2018 - 11:27PM
Dow Jones News
By Kate Davidson
President Trump reiterated his complaints that the Federal
Reserve is raising short-term interest rates too fast, calling the
U.S. central bank "my biggest threat."
"It's independent so I don't speak to him, but I'm not happy
with what he's doing, because it's going too fast," Mr. Trump said
in an interview with the Fox Business Network, referring to Fed
Chairman Jerome Powell, whom he nominated last year.
"You looked at the last inflation numbers, they're very low," he
said while arguing for a slower increase in interest rates.
The president acknowledged Mr. Powell was his pick to replace
former Fed Chairwoman Janet Yellen, and said he wasn't blaming
anyone.
"I put him there, and maybe it's right, maybe it's wrong," he
said, adding, "I put a couple of other people there that I'm not so
happy with too. For the most part, I'm very happy with people."
In the interview, Mr. Trump said Mr. Powell is "being extremely
conservative, let me use a nice term." But he demurred when asked
directly if Mr. Powell would be out of a job if his decisions prove
misguided. "So look, I am not happy with what he's doing," he
said.
The network released excerpts ahead of an interview with the
president that aired Tuesday night.
In the interview, Mr. Trump said Mr. Powell is "being extremely
conservative, let me use a nice term." But he demurred when asked
directly if Mr. Powell would be out of a job if his decisions prove
misguided. "Well number one, I don't appoint for another four
years, five years," the president said, "so look, I am not happy
with what he's doing."
The law is vague about whether a president can fire a Fed
chairman, who serves a four-year term.
Mr. Trump has nominated three of the four current members of the
Fed's board of governors: Mr. Powell, Vice Chairman Richard Clarida
and Vice Chairman for Supervision Randal Quarles. Three other Trump
nominations to the board are still awaiting Senate
confirmation.
The president's comments are his latest criticism leveled at the
central bank. On Oct. 9, he repeated his displeasure with the Fed
and said he believed inflation remained in check. "I think the Fed
has gone crazy," he told reporters the next day, in the middle of a
stock market selloff.
Mr. Powell said earlier this month he sees little sign the
economy is overheating, but defended the Fed against Mr. Trump's
criticism that policy makers are raising rates too fast.
Consumer prices, a broad measure of inflation, rose less than
expected for the second straight month in September, the Commerce
Department said last week, suggesting price pressures remain in
check. In the 12 months through September, overall prices rose
2.3%, the smallest year-over-year change since February.
The Fed's preferred inflation gauge, the personal-consumption
expenditures index, rose 2.2% in August from a year earlier, above
the Fed's 2% target.
Trump's repeated critiques represent a break from previous White
House protocols, dating back to the early 1990s, not to comment on
monetary policy or otherwise criticize the central bank.
Former Fed Chairwoman Janet Yellen said Monday the president's
attacks on the Fed are "counterproductive."
"There's no law against that," she said. "But I don't think it's
wise."
Write to Kate Davidson at kate.davidson@wsj.com
(END) Dow Jones Newswires
October 16, 2018 23:12 ET (03:12 GMT)
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