President Trump on Tuesday ramped up pressure on the Federal Reserve to slash interest rates, berating the central bank one week before it is expected to cut borrowing costs for the second time this month.
In a Tuesday tweet, Trump renewed his call for the Fed and Chairman Jerome Powell to slash rates to 0 percent or lower to match much weaker economies in Europe and Asia, one day after the stock market suffered its worst day of losses since 2008.
“Our pathetic, slow moving Federal Reserve, headed by Jay Powell, who raised rates too fast and lowered too late, should get our Fed Rate down to the levels of our competitor nations. They now have as much as a two point advantage, with even bigger currency help. Also, stimulate!” Trump tweeted.
“The Federal Reserve must be a leader, not a very late follower, which it has been!” the president wrote.
Trump nominated Powell to serve as the chief of the Federal Reserve in November 2017.
After a huge fall on Monday, markets were winning back some of their losses on Tuesday morning. The Dow Jones Industrial Average was up more than 700 points after 10 a.m.
Trump’s months-long campaign for near-zero or negative interest rates has intensified amid rising fears that the global coronavirus outbreak could plunge the U.S. economy into a bruising slowdown.
The Fed issued an emergency rate cut last week, reducing the baseline interest rate range by 0.5 percentage points to 1 to 1.25 percent. The Fed is widely expected to cut rates again next after its policymaking arm, the Federal Open Market Committee, meets in Washington, D.C., from March 17-18.
Even so, economists across the ideological spectrum say that the Fed’s efforts to cut already low interest rates may do little to stave off the harm of a coronavirus-driven slowdown.
While borrowing costs may be lower, businesses and workers may still suffer from steep declines in demand, consumer spending, supply chain disruption, social distances and a sick workforce.
Trump has sought to lessen concerns about the virus and the impact on the American economy, while announcing Monday that he would seek a payroll tax cut and relief for hourly workers to address the situation.
Trump administration officials are expected to meet with Senate Republicans on Tuesday to discuss the proposal, which would need to be approved by Congress.
“We have a great economy, we have a very strong economy,” Trump told reporters at the White House Monday evening. “This blindsided the world. And I think we’ve handled it very, very well.”