The American president has been asking for many weeks that the American central bank has lowered its guiding rates.
Donald Trump attacked Jerome Powell again, the president of the American central bank this Friday, August 1.
Above all, the American president challenged the members of the Board of Directors of the Federal Reserve (Fed), asking them “to take control and do what everyone knows what to do”.
“Jerome Powell, this stubborn moron, must considerably lower interest rates, now. If he continues to refuse, the board of directors should take control and do what everyone knows that you have to do!”, He wrote on his social social network.
The American president therefore plays the card of dissension that he feels at the “board” of the federal reserve.
Besides, in a second message posted this Friday afternoon, Donald Trump was more direct:
“Strong dissidents on the Fed Board of Directors! They are only going to worsen!” Too Late! “”, He wrote. [“Too late” étant le surnom que Donald Trump donne à Jerome Powell]
Disagreements within the Fed
Two governors of the board of the board of directors spoke out against the maintenance of the rates, decided by the Fed this Wednesday. It is the first time since 1993 that two members of the decision -making body have been against the decision taken.
The pressure is therefore strengthened on Jerome Powell, appointed by Trump during his first mandate but independent of it according to the statutes of the Central Bank.
Donald Trump has been a drop in these rates for several weeks to support growth and lighten the cost of debt. After the announcement of the maintenance of rates this week, the American president estimated that Jerome Powell was “late, and in reality, too pissed off, too stupid and too political to do this job”.
Increasing growth
So far, the Federal Reserve adopts a prudent monetary policy and refuses to lighten its rates too quickly, which are at a level twice as high as in the Euroean Union. She fears that a decrease can contribute to climbing prices. Inflation tends to increase in recent months ( + 0.3% in June, + 2.7% over one year) and new customs duties are likely to further increase the cost of imports.
In parallel, American GDP increased by 3% in the second quarter, in annualized pace. The latest figures on job creations in July are good, with 104,000 positions created, against a destruction of 23,000 jobs in June, according to the ADP/Stanford Lab monthly survey.
This is not the first time that the President of the United States has been conflict with the president of the Federal Reserve. Ronald Reagan also opposed Paul Volcker, when the latter proceeded from 1979 to a very rapid increase in interest rates to stem the high inflation caused by oil shocks.
However, the level of violence of Donald Trump’s attacks is undoubtedly unequaled, so that the independence of the Fed could be called into question.
