WASHINGTON – President Donald Trump blasted the Federal Reserve on Wednesday, saying the central bank was too quick to raise interest rates and too slow to lower rates.
“The Fed has got to do something! The Fed is the Central Bank of the United States, not the Central Bank of the World.” Mark Grant @Varneyco Correct! The Federal Reserve acted far too quickly, and now is very, very late. Too bad, so much to gain on the upside!
— Donald J. Trump (@realDonaldTrump) August 14, 2019
Last month the central bank lowered its federal funds rate from 2.25%-2.50% to 2.0-2.25%. It was first interest rate cut since 2008.
The Fed made four modest rate increases in 2018.
Trump has consistently criticized the Fed and Chairman Jerome Powell over the central bank’s monetary policy. Trump has refuted claims that he is looking to replace Powell.
U.S. allies such Germany and New Zealand have recently made significantly more aggressive rate cuts. Some have even lowered rates to below 1%.
The Fed has generally lowered interest rates when the economy is slow to encourage borrowing. The Fed has generally raised rates when the economy is booming.
Stocks tumbled on Wednesday.
As of 1 p.m. EDT., the Dow Jones Industrial Average (DJIA) had fallen more than 700 points amid analyst projections of a global recession and the ongoing effects of a trade war. The S&P 500 index, which analysts consider the benchmark for stock assessment, fell 2.75%. The NASDAQ index fell 3.05%.
The stock tumble came after the bond market triggered its first recession warning since 2007-the year before the Great Recession devastated world financial markets.