Trump rips Fed again for hiking interest rates

Alicia Cross
July 23, 2018

The committee is mandated by the U.S. Congress to foster a strong job market and stable prices.

Trump told CNBC in an interview that ran on Friday that he is "ready to go to 500" on tariffs on Chinese imports.

Earlier this month, the United States imposed 25% tariffs on $34bn of Chinese imports.

Around $505 billion of Chinese goods came into the United States in 2017, leading to a trade deficit of almost $376 billion, U.S. government data shows. And last week, the administration announced plans for yet more tariffs on $200 billion worth of additional Chinese imports. Beijing vowed "firm and forceful measures" in response.

Shortly after taking office, Trump withdrew from the Trans-Pacific Partnership (TPP), which he said would steal millions of jobs from Americans, while the North American Free Trade Agreement (NAFTA), signed by Canada, Mexico, and the United States, is now being renegotiated. "I'm not doing this for politics; I'm doing this to do the right thing for our country". In return, China levied taxes on the same value of USA products.

The Chinese yuan and the euro have both lost value against the dollar this year, though in 2017 the dollar had its worst year since 2003.

USA equity futures turned lower with European stocks on Trump's threat.

President Trump threatened to impose tariffs on every product imported from China, dialing up the pressure in the growing trade dispute between the world's two economic superpowers.

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Trump has ordered Commerce to investigate whether auto imports pose a threat to US national security that would justify tariffs or other trade restrictions. Earlier this year, he invoked national security as a justification for taxing imported steel and aluminum.

The threat to place tariffs on all Chinese goods sent to the United States would effectively end the tit-for-tat trade battle between the two nations, as Chinese imports from the U.S. are a comparatively small $US129.9 billion.

Trump has told reporters before that the US could target all of China's imports.

White House aides said Mr Trump was not trying to influence the Fed, the nation's central bank, but added he would prefer if officials paused their plans for rate increases to avoid dampening economic growth.

I put a very good man in the Fed.

Many companies in the United States are opposed to the administration's use of tariffs against China, saying they risk hurting business and the economy without being likely to change behaviour.

Feroli also noted that the easiest way for Trump to bend the Fed to his political will would be to fill the Federal Reserve Board of Governors with members that agreed with a low interest rate policy or were personally connected to the president. When it came to interest rates, Nixon told his advisers "we'll take inflation if necessary, but we can't take unemployment".

Other reports by Free-Prsite

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