World News

Trump says Fed raising rates was a mistake: CNBC

(Reuters) – The United States’ economy would be growing at a pace near 4% if wasn’t for the lingering effect of Federal Reserve rate hikes, President Donald Trump told CNBC in an interview on Wednesday.

“Now, with all of that, had we not done the big raise on interest, I think we would have been close to 4%,” Trump told CNBC https://www.cnbc.com/2020/01/22/trump-says-gdp-dow-would-be-higher-if-it-werent-for-the-fed.html?&qsearchterm=trump.

“And I could see 5,000 to 10,000 points more on the Dow. But that was a killer when they raised the rate. It was just a big mistake.”

U.S. gross domestic product increased at a 2.1% annualized rate in the third-quarter of 2019.

Trump nominated Jerome Powell in late 2017 to succeed Janet Yellen as the Fed chair, but he soured on the former lawyer and investment banker in 2018 after Powell steered the Fed through a series of rate increases.

Trump has previously blasted the hikes as “loco” and “ridiculous” and accused the Fed of undercutting economic growth.

The U.S. central bank subsequently cut rates three times in 2019.

In his CNBC interview, Trump also said that Boeing’s <BA.N> 737 MAX fleet grounding and the strike at General Motors <GM.N> had weighed on the economy.

“But we had Boeing. We had the big strike with General Motors. We had things happen that are very unusual to happen,” Trump told CNBC’s Joe Kernen in an interview from the World Economic Forum in Davos, Switzerland.

(Reporting by Shubham Kalia in Bengaluru; Editing by Toby Chopra)

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