President Donald Trump on Thursday, June 11, criticized the Federal Reserve after it offered a gloomy outlook on the U.S. economy, which shook the stock market after months of steady gains.
The Dow Jones Industrial Average lost more than 1,800 points, or 6.9%, on Thursday, recording the worst day since crashing in March amid the lockdown imposed to limit the spread of the CCP Virus, or coronavirus pandemic.
The abrupt reversal, following more than two months of steady recovery, came after the Fed slashed its forecast for U.S. GDP growth this year to -6.5% and raised its median forecast for 2020 unemployment to 9.3%.
At a press conference on Wednesday, Fed Chairman Jerome Powell also offered a prediction of a “long road” to recovery for the world’s largest economy.
“You could see significant job growth in—in coming months, as people return to their jobs, but you’re still going to face probably an extended period where it will be difficult for many people to find work, and for—and that’s what you see in—in–in really many, many forecasts at this point,” Powell said. “That doesn’t mean it’s right, but that’s sort of a—a broad expectation, certainly not the depression forecast.”
The central bank on Thursday kept the interest rates unchanged at a range between zero and 0.25% and signaled it will not raise the rates at least through 2022.
“What we’re trying to do is create an environment in which they have the best chance either to go back to their old job or to get a new job,” Powell said.
However, President Trump slammed at the Fed for underestimating how quickly the economy could recover from the virus pandemic and even challenged the Fed on the short-term outlook when he expects a vaccine could be available.
“The Federal Reserve is wrong so often. I see the numbers also, and do MUCH better than they do,” Trump tweeted.
“We will have a very good Third Quarter, a great Fourth Quarter, and one of our best ever years in 2021. We will also soon have a Vaccine & Therapeutics/Cure. That’s my opinion. WATCH!” president added.
The Federal Reserve is wrong so often. I see the numbers also, and do MUCH better than they do. We will have a very good Third Quarter, a great Fourth Quarter, and one of our best ever years in 2021. We will also soon have a Vaccine & Therapeutics/Cure. That’s my opinion. WATCH!
— Donald J. Trump (@realDonaldTrump) June 11, 2020