By The Epoch Times | Created at 2026-09-16 23:51:52 | Updated at 2026-09-17 00:55:56
1 hour ago
President Donald Trump pressed for lower interest rates shortly after the Federal Reserve announced its first hike in more than three years.
In a Sept. 16 Truth Social post, he repeated that the United States should have the lowest rates on the planet “because we are the best credit in the world,” adding that they should be set at 1 percent “or less.”
“Our Country is booming with new Investment!” Trump said on his social media platform. “If we stopped Trading with every country that we have a Deficit with, which is most of them, we would make, at least, 1.5 Trillion Dollars a year.”
The term deficit is “nothing more than a fancy word for loss,” he added.
“Lower the interest rates for the United States of America, and fast!” Trump wrote.
For the first time since July 2023, the Fed hiked the benchmark federal funds rate—a key policy rate that influences business and consumer borrowing costs—by a quarter point to a new target range of 3.75 percent to 4 percent.
Chairman Kevin Warsh, whom the president nominated earlier this year, joined 11 colleagues in tightening monetary policy as the central bank’s 2 percent target remains elusive.
A flurry of recent indicators suggests headline inflation is firmly above 3 percent. Excluding food and energy, the 12-month core inflation rate is closer to the 2 percent objective.
Like the European Central Bank last week, the Fed implemented a 25-basis-point rate hike to quell the second- and third-order effects of the oil price shock from the war in Iran, now approaching its seventh month.
“But what we can do and will do is ensure that any change in relative prices don’t broaden out, don’t have second and third order effects on the economy,” Warsh said in his post-meeting press conference. “That’s what we’re tasked to do, and that’s what we do.”
Warsh reiterated his stance that the Fed will take the price stability side of its dual mandate seriously and ensure working-class Americans do not bear the brunt of high inflation.
“The plain fact is that inflation is too high and has been for too long,” Warsh told reporters.
“Price stability is foundational to economic growth, and I think we took an important step today to deliver it. We did it in part by removing the dose of accommodation that I mentioned before.”
The White House called the rate decision “unfortunate” as it is not supported “by a particularly compelling case.”
“To the extent that we still do have inflation, as the president and others have noted, it’s entirely driven by an energy supply shock, by what’s going on with oil prices in the Middle East,” White House spokesman Kush Desai said in a Fox News interview.
“These are things that have nothing to do with interest rates and are not affected really by higher interest rates.”
Rising interest rates will only adversely impact U.S. economic growth prospects, he added.
Based on the Summary of Economic Projections—the Fed’s quarterly outlook for policy and the economy—monetary policymakers are penciling in at least one more rate hike.
The futures market is split on whether the Fed will raise interest rates again at either the October or December Federal Open Market Committee meeting, according to the latest CME FedWatch data.
With the earliest estimates, including the Cleveland Fed’s Nowcasting Model, pointing to little change in the September numbers, Warsh and the Fed might have no alternative but to hike again, says Christian Hoffmann, head of fixed income at Thornburg Investment Management.
“Fed watchers may increasingly focus on a potential new ’tell': the number of inflation categories above 3 percent as a measure of underlying inflation pressure,” Hoffmann said in an emailed note to The Epoch Times.
“The messaging was clearly crafted to accompany a hawkish hike.”
Warsh will hold the next two-day policy meeting on Oct. 27 and Oct. 28.
