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Trump Says He's 'Not Thrilled' About US Interest Rate Hikes

20 July 2018

"I don't really - I am not happy about it", he said.

In a CNBC interview that aired earlier on Friday, Trump said he's "ready to go" with tariffs on $500 billion of Chinese goods, roughly the value of all US imports from the Asian nation a year ago.

The U.S. central bank last raised borrowing costs in June, and Fed Chair Jerome Powell on Wednesday repeated his oft-stated view that rates will keep climbing gradually.

Trump told CNBC that he's "not thrilled" with Fed Chairman Jerome Powell, who he appointed, over the central bank's rate hikes. In emerging markets such as Turkey, the government of President Recep Tayyip Erdogan has felt no such restraint.

"And it is worth pondering whether this is a President who is going to break with 25-30 years of tradition in not interfering in Fed policy deliberations going forward". Then, his complaint was that interest rates were too low.

For years presidents have avoided commenting on the Fed, which markets broadly trust to act in service of its dual objective - maintaining maximum inflation and stable prices - rather than a political aim.

"I don't necessarily agree with it, because he's raising interest rates ..." Fed officials have penciled in two more hikes this year.

Fed spokeswoman Michelle Smith declined to comment. Powell last week told American Public Media's "Marketplace" program that the Fed has "a long tradition here of conducting policy in a particular way, and that way is independent of all political concerns".

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Trump, in an interview with CNBC, said he does not approve, even though he said he "put a very good man in" at the Fed in Powell.

The U.S. dollar index cut its gains after Trump's comments that the strong dollar "puts us at a disadvantage", while yields on U.S. Treasury securities hit session lows.

The current target range for its policy benchmark is 1.75 percent and 2 percent.

In an apparent reference to Fed rate increases, Trump added, "Tightening now hurts all that we have done".

During the 2016 presidential campaign, Trump was highly critical of the Fed and accused its policymakers of keeping rates at ultra-low levels to favor Democrats. But the past three administrations under Bill Clinton, George W. Bush and Barack Obama have refrained from publicly commenting on policy decisions.

Mr Trump, in part of an interview aired by CNBC, broke with the long-established executive branch practice of not commenting on the Federal Reserve's decisions out of respect for its independence.

The White House later clarified Trump's statements.