Trump again attacks Fed, says central bank 'derelict in its duties'

WASHINGTON (AFP) – President Donald Trump once again attacked the US Federal Reserve on Thursday (Oct 24), calling for more interest rate cuts to stimulate the American economy just days before the key policy meeting.

“The Federal Reserve is derelict in its duties if it doesn’t lower the Rate and even, ideally, stimulate,” he said on Twitter, a relatively mild epithet after calling policymakers “boneheads” and “pathetic”.

Trump has long argued that the Fed was too aggressive about raising the benchmark borrowing rate, which rose four times in 2018.

Under Fed chairman Jerome Powell, the Fed cut the rate twice this year, and could do so again at the two-day meeting next week, although some economists are calling for a pause.

Trump’s blitz of insults and criticism directed at the Fed had slowed in recent weeks, with the most recent occurring two weeks ago when he said US central bankers “don’t have a clue but I do”.

“Take a look around the World at our competitors. Germany and others are actually GETTING PAID to borrow money. Fed was way too fast to raise, and way too slow to cut!” Trump tweeted, pausing in his focus on the impeachment inquiry against him in Congress.

The European Central Bank left its policy interest rate unchanged on Thursday at minus 0.5 per cent, while the Bank of Japan – also set to meet next week – has a minus 0.1 per cent rate as sluggish economic growth persists.

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