Federal Reserve chief asked if he gave into Donald Trump
Trump asks Fed for "big cut"
President Donald Trump has once again called on the Federal Reserve to take some important monetary easing measures after Australia's central bank cut rates to a record low and noted the impact of the coronavirus outbreak.
The Reserve Bank of Australia said Tuesday that it is cutting its key rate to 0.5% to cushion the economic impact of the new coronavirus. Philip Lowe, bank manager, said the epidemic had caused «significant blow» on the country's economy.
A few hours later, the President of the United States tweeted that the Chairman of the United States Central Bank «called it wrong from day one».
«Australia's central bank cut interest rates and said it would likely ease the situation further to offset China's coronavirus outbreak and slowdown … Other countries are doing the same, if not more. Our Federal Reserve forces us to pay higher rates than many others when we should pay less», – Trump thinks.
Trump Wants to See Fed Make a Large Rate Cut
«This greatly affects our exporters and puts the United States at a competitive disadvantage. It should be the other way around. It is necessary to ease the conditions and lower the rate», – he added.
The President regularly criticized the work of the Federal Reserve, as well as its chairman, Jerome Powell, believing that lower rates would stimulate the American economy. The Fed, for its part, claims to make policy decisions based on employment and inflation data..
As the coronavirus spreads around the world and affects the global economy, analysts expect central banks to announce monetary stimulus to help their countries cope with any economic shock. Goldman Sachs said Monday that the Federal Reserve is likely to cut the rate by 50 basis points at its March meeting..
Powell said Friday that the central bank is monitoring the coronavirus situation and has pledged to take action if necessary. During a conference call on Tuesday, officials from the world's largest economies announced a united front against the coronavirus threat, but did not offer any concrete action..