Trump takes swipe at Fed for raising interest rates too quickly

Трамп назвав ФРС головною загрозою своїм економічним успіхам у США

The continued "gradual" rate increases are regarded as insurance against that possibility. The result is continual massive buildup of government, personal and corporate debt. This is because other central banks have not moved from the low interest rates. Despite the rate increases since 2015, the stance of monetary policy is still accommodative.

Fed officials overall expect rates to rise to 3.1 percent next year and 3.4 percent in 2020, just above their 3 percent estimate for the long-run "neutral" rate at which borrowing costs are neither braking nor stimulating economic growth.

Minutes from the latest Federal Reserve meeting in September showed yet another strong defense for policy makers to maintain their current path of gradually raising rates. The post crisis period marked by massive spending and effectively zero rate money may have lulled some of us into a belief that "free money" was here to stay.

The market has priced in another hike in December, with three more increases expected in 2019, which would take rates in the U.S. to a level slightly above neutral. The tools which are at the disposal of the central bank have the capabilities to boost the economy in short-term at the risk of high inflation and adverse consequences in the long term. He's argued that the US economy has been saddled with persistently low growth, so there is little need to raise interest rates much.

NO: The unemployment rate is the lowest it's been in 50 years. "The Fed's board was chosen very well by the administration, and it's a good group of people and they will do what they have to do". That was then, this is now.

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Still, the minutes showed that, for the moment at least, American policymakers were largely in agreement about the near future - despite the increasing heat from the president, who fears higher rates will derail his economic agenda.

A spokeswoman for the Fed declined to comment on the president's latest remarks. That's about how much the Fed has been raising rates every time it meets to do so. "And it's independent, so I don't speak to him". At that point, the policy rate would be at 3.4 percent, according to the median of Fed officials' individual forecasts. Higher rates can slow growth and the easy credit that has helped fuel stock markets in recent years. When interest-rate increases occur quickly, the impact could be significant to everyone, consumers and businesses alike.

"The economy keeps surprising to the upside". Furthermore, "some" at the meeting said risks grew as the USA economy increasingly outpaced its rivals" more sluggish growth "because of the potential for further strengthening of the dollar'. Shanghai's benchmark stock index tumbled overnight to close at a near four-year low and China's premier warned of risks to the economy. When it eases the monetary policy, it makes borrowing cheap which may or sometimes leads to a weaker dollar. This measured approach is already affecting some sections of the economy including housing and auto sales. In the USA, the Federal Reserve is an independent institution, although the president of the country still has the prerogative to assign or fire the chairman.

NO: The Federal Reserve is not being too aggressive with rates.

It is also in line with some beliefs that the United States is at the end of a 30-year bull run for bonds, with yields recently having broken out of their long-term downtrend.

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