Fed draws White House fire as it prepares to raise rates

Dec 19, 2018, 02:05
Fed draws White House fire as it prepares to raise rates

President Donald Trump slammed the Federal Reserve on the eve of a pivotal policy meeting for "even considering" another interest-rate increase, and suggested the central bank has no reason to move because inflation is low and the US currency is strong.

On Monday, he called it "incredible" that the Fed would consider raising rates this week with "the outside world blowing up around us".

Amid brisk economic expansion after a decade of steady job growth, United States unemployment is flirting with a 50-year low, but the USA economy is expected to slow. On Wednesday, the Fed is widely expected to scale back its forecast to just two rate increases for next year. The Fed had predicted three more rate hikes next year, but many economists now think that is too many, especially with many experts predicting the US economy will start slowing next year and could end up in a recession by 2020. The rates were also hiked in March, June, and September.

Today America's Federal Reserve are expected to raise official interest rates for the fourth time this year, and the ninth time since 2015, when it decided that it was safe to do so.

Congress leads in Rajasthan Assembly Elections, crosses majority mark
Mr Modi's grandiose promises - especially to create more jobs and increase incomes of farmers - have begun to bite. The BJP's stridently majoritarian politics, critics say, has fanned hate and left the country deeply divided.

In a tweet, President Trump advised the Fed to "feel the market" and not to "just go by meaningless numbers".

At a critical juncture in the Fed's effort to prevent the economy from overheating, Trump is presenting the biggest presidential challenge to US central bank independence in decades.

A shift in the Fed's policy will likely have a large impact on the global economy and financial markets.

Sohn is forecasting that after expanding almost 3 percent this year, the economy will grow closer to a middling 2 percent in 2019. The dot plot, updated quarterly, displays the anonymous projections of individual Fed officials for the path of their benchmark rate as well as for inflation and economic growth. Investors will be looking for signs that the central bank realizes that the economy isn't going to grow as fast as it had thought, but that it's not going to slow too much-and that it realizes it is coming close to tightening the economy into a recession.

White House hails China trade truce as skeptics raise doubts
At the same time, analysts said they were relieved that the Trump-Xi meeting at least pressed the "pause" button on tariff hikes. Currently, the automobile industry in the United States is not performing well because of the trade war issues with China.

So far, Powell has taken care to express concern about rising tariffs while noting that they might ultimately prove beneficial if they force China and other nations to lower their trade barriers and thereby promote freer trade. As a result, like many economists, he predicts that the Fed will raise rates only twice next year.

After the Wall Street Journal posted an op-ed, which suggested that raising interest rates will hurt the economy, Trump told the feds to listen to the publication.

The Monday tweet isn't the first time that Trump has recently taken aim at France.

MS votes in Senate race marked by racial controversy
The discovery comes just before Tuesday's runoff election between Democrat Mike Espy , who is black, and Republican Sen. Before departing for MS on Monday, the president said he felt "very badly" for the controversy Hyde-Smith has faced.

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