President Donald Trump on Wednesday, June 26, repeated his arguments that the U.S. economy could have hit a growth rate of up to 5 percent and the Dow Jones Industrial Average could have added another 10,000 points if the central bank had not tightened monetary policies too much.
In an interview via telephone with Fox Business, Trump said the Federal Reserve (Fed) Chairman Jerome Powell “should have never raised the (interest) rates to the extent that he did.”
“If he would have raised them half—just half—and if he would have not done the quantitative tightening, our market would have been up another 10,000 points,” the president said, referring to the Dow Jones stock index.
Trump added, “GDP would have been up another point or two points. We could have hit—we potentially could have hit 5 [percent].”
The Fed, under Jerome Powell, raised the federal funds rate seven times in 2017 and 2018 from near-zero levels. In the latest policy meeting on June 19, its Federal Open Market Committee (FOMC) voted to keep the target range for the rate at 2.25-2.5 percent, unchanged from last December.
At times, President Trump said he was not happy with what the central bank chief had done. In the Wednesday interview, he said the United States would be better off if European Central Bank (ECB) President Mario Draghi led the Fed instead of Powell.
“European nations were set up in order to take advantage of the United States … they have Draghi who is – we should have Draghi instead of our Fed person,” Trump said, praising Europe for lowering interest rates and purchasing financial assets to stimulate its economy.
Despite being not being happy with Powell, President Trump said Wednesday that he never suggested he would fire the Fed chairman though he had the right to do it.