Donald Trump calls for jumbo rate cut in row with Fed
Donald Trump yesterday launched a fresh attack on the US Federal Reserve as he demanded a full percentage point interest rate cut.
The President's latest assault on rate setters came amid the latest evidence that the jobs market is cooling.
In a post on his social media platform Truth Social, Trump urged Fed chairman Jerome Powell to act to stimulate the economy. He wrote: 'Go for a full point, Rocket Fuel!'
Trump has previously had to row back on suggestions that he might sack Powell after markets bridled at the threat to the Fed's independence.
But he has continued to fire pot shots at the Fed chief, branding him 'Too Late' over his reluctance to cut rates.
And after a previous 24 hours dominated by Trump's row with Elon Musk, the president turned his ire back to Powell yesterday. Repeating the 'Too Late' jibe, he added: 'He is costing our country a fortune. Borrowing costs should be MUCH LOWER!!!'
His call for a full point is certain to receive short shrift from the Fed. The central banks typically reserve such large moves for times of crisis.
And the Fed has been particularly cautious over recent months as it waits to judge the impact of the US President's chaotic policies.
The remarks came after official figures pointed to subdued job creation in the world's biggest economy as the President's trade war take its toll.
So-called non-farm payrolls – a key measure of employment – rose by just 139,000 last month.
That was down from 147,000 in April. Unemployment remained at 4.2 per cent. Meanwhile, revisions to previous figures shaved 95,000 from March and April payrolls. But the headline jobs figure was better than expected, helping New York stock markets rally.
The S&P 500 hit the 6,000-mark for the first time since February and the Dow Jones and the tech-heavy Nasdaq each climbed by more than 1 per cent.
'This is a sigh of relief report,' said Scott Ladner, chief investment officer at Horizon Investments. 'People were really worried that this was going to be a kind of start of a downturn in the labour market and therefore start the downturn in the economy. We've got a sort-of bit of a reprieve.'
Janet Mui, head of market analysis at wealth manager RBC Brewin Dolphin said: 'The US jobs report data for May suggests the economy is holding up and far from recessionary.
'Overall, the sticky wage growth figures and stable job market reinforces a 'wait-and-see' mode for Federal Reserve officials.'
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