Trump calls on Fed to cut interest rates to zero 'or less'

Jerome Powell speaks during a news conference following a two-day Federal Open Marke

Jerome Powell speaks during a news conference following a two-day Federal Open Marke

Donald Trump has urged the US Federal Reserve to slash interest rates to zero or even into negative territory as he lashed out ahead of the central bank's crucial decision next week.

President Donald Trump says the U.S. is missing out economically because "Boneheads" at the Federal Reserve won't lower interest rates at his insistence.

Selgin further writes that, contra Trump's implication, "it simply isn't true that there is no risk of inflation, or that the Fed isn't capable of generating it".

The Fed's benchmark overnight lending rate is now targeted at between 2% and 2.25%, the highest rate of any Group of Seven nation. "But the Fed can still go too low; and every usual indicator suggests that setting rates at zero, let alone below, would be setting them way too low". Poll has a margin of error of 3.5 percentage points.

President Donald Trump lambasted the independent Federal Reserve early Wednesday, saying interest rates should be zero or negative and that the U.S. should refinance its more than $US22 trillion in debt.

Trump has already criticized Powell several times over the interest rate issue.

Murphy is not persuaded by folks who point to other countries that have tried or are trying what Trump proposes. Investors "will think the Fed knows something the market doesn't know". The Washington Post, meanwhile, wonders how much debt-riddled businessman Trump could save if he pressures the "boneheads" at the Fed into doing his whim. The US central bank is widely expected to cut rates for only the second time in a decade at next Wednesday's meeting. Trump has pushed to bring the rate down to be more in line with that of other nations, which have interest rates of nearly zero percent.