President Donald Trump threatened on Friday to prevent the US from trading with many nations unless the Federal Reserve lowers interest rates.
“LOWER THE RATE OR I’LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT, which the U.S. Supreme Court, in its ridiculous and very costly Tariff decision, strongly acknowledged ‘the President’ has an absolute right to do,” Trump said in a post on Truth Social. “IT’S BETTER THAN TARIFFS! The Fed Board, with its great new leader, must get smart - BE PATRIOTS for a change.”
A trade deficit occurs when a country imports more than it exports. At over $200 billion, the US ran its largest trade deficit with China last year, followed by Mexico and Vietnam. Overall, the US ran a $1.2 trillion trade deficit with all trading partners last year, according to federal trade data.
Trump’s threat came shortly after August’s surprisingly hot jobs report showed that US employers hired 162,000 new workers that month, more than double the level economists anticipated.
The strong report opens the door even wider for the Fed to hike interest rates to fight back against inflation concerns. Officials meet later this month to decide where rates should be.
