Trump Threatens $1.5 Trillion Trade Cutoff After Fed Raises Rates 0.25 Point
Updated
Updated · The New York Times · Sep 16
Trump Threatens $1.5 Trillion Trade Cutoff After Fed Raises Rates 0.25 Point
3 articles · Updated · The New York Times · Sep 16
Summary
A quarter-point Fed rate increase drew an immediate Trump threat to curb U.S. trade with deficit countries unless the central bank cuts borrowing costs.
Trump said he spoke with newly confirmed Chair Kevin Warsh before the unanimous vote, then praised Warsh while attacking other governors as political and hostile.
His demand goes beyond a pause: Trump said rates should fall to 1% or lower and argued trade restrictions could erase deficits and bring in $1.5 trillion a year.
Economists warn both steps could backfire — sweeping trade cutoffs would hit U.S. households and businesses, while deep rate cuts could worsen inflation and complicate the Fed's job.