President Donald Trump said he won’t fire US Federal Reserve chairman Jerome Powell but blamed an “out of control” US central bank for the worst stock market sell-off since February.
President Trump also told reporters in the Oval Office that he knows monetary policy better than the Fed’s leaders and continued criticising them for interest-rate increases.
“The Fed is out of control,” President Trump said. “I think what they’re doing is wrong.”
The president added that the Fed’s interest rate increases are “not necessary in my opinion and I think I know about it better than they do.”
His criticisms mark a stunning departure from the practices of his recent predecessors.
Presidents for more than two decades had avoided public comments on the Fed’s interest-rate policies as a way of demonstrating respect for the institution’s independence.
For a president who has frequently invoked rising stock prices as affirmation for his economic policies, criticism of the Fed’s monetary policies lays ground for shifting blame elsewhere if the market slide continues. He is escalating his attacks on the Fed with less than a month to go before elections that will determine whether Republicans maintain control of Congress.
The current Federal Funds’ target rate range of 2% to 2.25% is low by historical standards. With the consumer price index up 2.3% over the past year, that amounts to an interest rate of zero in real terms.
The president has repeatedly criticised the Fed over the past 24 hours as markets plunged.