Donald Trump has cast blame on “badly run and weak companies” that are struggling in the wake of his stiff international tariffs, and suggested that the US would have “one of the biggest Stock Market increases” if the US Federal Reserve would just cut interest rates.
Mr Trump’s claims come amid mounting signs that his trade war with China is damaging the US economy, and as American companies have complained that the stiff tariffs have put extra strain on manufacturers as the sector has slowed.
The attack on the Fed has become a mainstay of the president’s in recent weeks, too, as he seeks to put pressure on the financial regulator to cut interest rates in spite of his insistence that the US economy is strong. The Fed generally cuts borrowing costs when the economy needs help — to spur the flow of capital — and raises the rates during a strong economy to keep economic excesses in check. The Fed cut rates for the first time since the 2008 financial crisis earlier this year.
We’ll tell you what’s true. You can form your own view.
From 15p €0.18 $0.18 USD 0.27
a day, more exclusives, analysis and extras.
“If the Fed would cut, we would have one of the biggest Stock Market increases in a long time. Badly run and weak companies are smartly blaming these small Tariffs instead of themselves for bad management…and who can really blame them for doing that? Excuses!” Mr Trump tweeted on Friday morning.
Earlier in the morning, Mr Trump also claimed that the Fed is responsible for allowing Europe to gain a trade advantage over the US, as the Euro drops in value compared to the dollar.
“The Euro is dropping against the Dollar “like crazy,” giving them a big export and manufacturing advantage…and the Fed does NOTHING! Our Dollar is now the strongest in history. Sounds good, doesn’t it? Except to those (manufacturers) that make product for sale outside the U.S.”, Mr Trump wrote.
The manufacturing sector’s output has slowed for two consecutive quarters, leading many to note that the circumstances have met the standard definition of a recession.
The sector, which Mr Trump pledged to revive as a presidential candidate, is among the hardest hit by Mr Trump’s trade war with China, and could complicate his hopes of re-election next year if the economic situation continues to deteriorate.
Manufacturing plays a key role in several states that helped Mr Trump along to his surprise win in 2016, including Pennsylvania, Wisconsin, and Michigan.
Mr Trump has said he plans on increasing tariffs on Chinese imports even further, too, from 25 per cent to 30 per cent.