Washington, July 28: President Donald Trump has called on the Federal Reserve to lower interest rates, arguing that the U.S. economy should have the lowest borrowing rates in the world given its current expansion.
During a conversation with reporters aboard Air Force One on his way to Michigan, Trump made these remarks ahead of this week’s Federal Open Market Committee (FOMC) meeting.
He stated, “Interest rates should be lowered. This country can achieve GDP growth of 8, 9, 10 percent, even 12 percent. That should be the case.”
Trump pointed out that interest rates in the U.S. are higher than in several countries that heavily rely on America for economic and security support.
He emphasized, “The lowest interest rates in the world should belong to the U.S. There are many countries with lower rates than ours, and without U.S. support, their existence would be challenging.”
When asked if he feared the Federal Reserve might raise rates to control inflation, Trump noted that the central bank’s leadership needs to gain support from its board.
He remarked, “I have a board too. Kevin is great, but he also has a board, and I believe board members are largely influenced by political thinking. They want to do the right thing. I know what they want to do, but they need the agreement of some people whose intentions may not be right.”
Citing recent inflation data, Trump claimed that prices are rapidly declining. He once again held former President Joe Biden responsible for the inflation increase during his tenure.
Trump stated, “Costs are coming down quickly. Don’t forget that I haven’t been in office long. I inherited the worst inflation in history from Biden, but now costs are decreasing rapidly.”
He linked the future of inflation to the ongoing conflict related to Iran, suggesting that prices could drop significantly once the war ends. He said, “As soon as this war is over, you will see a significant drop in prices.”
Using Switzerland as an example, he pointed out that despite a significant trade imbalance with the U.S., the country maintains low borrowing rates.
He added, “If you look at Switzerland, where our deficit is $30 billion, I could eliminate that deficit overnight.”
Trump has repeatedly asserted that lower interest rates would encourage investment, reduce borrowing costs, and strengthen economic growth. Traditionally, presidents avoid directing the Federal Reserve’s monetary policy decisions, although they can comment publicly on economic conditions.
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