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Jerome Powell became president of the Federal Reserve after Janet Yellen. She was associated with Republicans with former President Barack Obama and Democrats.
But if President Trump had thought of another bank interest rate policy through leadership change, this is not exactly what has been followed. Seven times in two years, the Fed raised the key rate, and the Fed posted two increases this year.
The President does not like it. On Thursday, Trump told CNBC that he was worried that rising interest rates would hurt the US economy. And he seems to take it personally:
"Tightening now damages everything we've accomplished," he tweeted after the interview.
The Trump merit was aimed at where possible tax cuts were decided. According to the Wall Street Journal, the economic policy put in place since the beginning of the presidency is expected to increase US growth by about 0.75 percentage point this year and next year. But if interest rates rise, and therefore the cost of borrowing, this can slow down growth. At the same time, the dollar is gaining in value: investors wishing to obtain a better return on their capital are deducted in the United States to benefit from high interest rates
Reasonable
As the Swedish bank, the Fed has an inflation target of 2%. And now, when the target is in place and the US has a low unemployment rate (4%), economists argue that it is reasonable to raise interest rates and that the dollar is much appreciated.
funds, while the dollar is strengthening. In a series of tweets on Friday, Trump has extended his charges to the EU and the euro.
"We are losing our competitive edge," complains the president.
On July 25, Trump will receive European Commission President Jean-Claude Juncker in Washington. They have a lot to talk about. Since Trump has decided to introduce tariffs on products like steel, the EU has responded with customs duties on goods from the United States. This list includes jeans, motorcycles and whiskeys. If US incomes fall, Trump voters learn the state of mind.
Independents
US presidents, like the leaders of other developed economies, refrain from criticizing the central bank or making decisions. At the moment, it is mostly the powerful Turkish President Recep Tayyip Erdogan who lets talk when he signals to the central bank that he likes to see the interest rate low
but it happened Closer Look: Richard Nixon urged Arthur Burns to keep the rate low before the 1972 presidential election, when Nixon would be reelected. He said he preferred inflation before unemployment.
Former Finance Minister Larry Summers on Friday assessed Trump's approach to the CNBC's central bank. He compared how it is to the banana republics.
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