Washington, August 20: President Donald Trump has once again criticized the Federal Reserve’s policies, reiterating his call for a reduction in interest rates. He described the current borrowing costs as “absurd” and dismissed concerns that fluctuations in the bond market could pose a threat to the U.S. economy.
During a press briefing at the White House, Trump stated that borrowing costs should decrease rather than increase in a strong economy like the United States. He also rejected worries about volatility in the bond market.
Trump remarked, “Every time we present excellent economic data, interest rates go up. They are raised because people want to control inflation. However, rates should be lowered because the country is in a strong position.”
He questioned why the U.S. has to pay higher interest rates compared to countries like Switzerland, which rely heavily on the American market.
“I look at countries like Switzerland, where interest rates are only half a percent, while we are paying 3.5 percent,” he said.
Trump argued that the U.S. could impact the economies of various countries by limiting trade relations, making it unreasonable for those countries to secure loans at lower interest rates from the U.S.
“If I stop trading with them and their economies suffer, why should they be considered a special or superior economy? They depend on America,” he added.
While praising the Federal Reserve Chairman, Trump criticized the board of the central bank, labeling it as politically influenced. He noted that board members were appointed by Obama, Biden, and himself.
“We have a great chairman, and I believe he is doing a good job. The problem lies with the board, which is political,” Trump stated.
He further mentioned that a reduction in interest rates would significantly decrease the federal government’s interest payments. According to him, every one percent increase in interest rates adds approximately $600 billion in debt to the nation.
“America should be paying the lowest interest rates in the world. Every one percent in interest equals $600 billion,” he said.
When asked about concerns regarding instability in the bond market, Trump suggested that people need not worry.
“No, I don’t think so. Our country is performing very well despite high-interest rates. Current rates are artificially elevated and have been increased without solid justification,” he explained.
Trump claimed that trillions of dollars are flowing into factories, manufacturing units, and other projects in the U.S., contributing to a robust economy despite high borrowing costs.
“We are the fastest-growing and most attractive economy in the world. No one can match us globally,” he concluded.
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