Trump praises Treasury Secretary Mnuchin but hits Fed again on rate rises

Trump praises Treasury Secretary Mnuchin but hits Fed again on rate rises

Mnuchin tweeted on Saturday that he spoke with the President, relaying that Trump said, "I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so".

"They're raising interest rates too fast", he said in the Oval Office after a Christmas Day phone call with U.S. troops.

An official from the White House has assured that the head of the US Federal Reserve is not at any risk of being dismissed from his position, amid the jitters that have been observed on Wall Street throughout the month that was partly caused by Trump's criticism of the Fed.

The Dow dropped by 2.9% and the S&P 500 fell 2.7%, the biggest drops ever for the two indexes on Christmas Eve.

Despite his displeasure with the impending rate hike, Trump gave a vote of confidence to Treasury Secretary Steven Mnuchin, referring to him as a "very talented guy, very smart person".

"I am highly confident that the president is very happy with Secretary Mnuchin", White House Council of Economic Advisers Chairman Kevin Hassett told Fox Business Network. The S&P 500 has lost about 19.8 percent from its September 20 closing high, just shy of the 20 percent threshold that commonly defines a bear market.

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One reason stocks have been declining is the partial United States government shutdown over Mr Trump's demand for billions of dollars for a wall on the Mexican border - his top campaign promise.

"We've all been doing that really quite a bit over the few weeks".

Mnuchin said after meeting with the chief executives of six of the largest banks on Sunday that each had "ample liquidity available for lending". "So I think it's a tremendous opportunity to buy", Trump said, according to a report on Reuters website.

The U.S. dollar slipped on Monday as concerns about a prolonged government shutdown and sharply lower equity markets reduced demand for the greenback. "And so I think that the momentum that we saw this year is carrying forward to next year".

Before that quarter-point rate rise, Trump had complained in a tweet that it was "incredible" for the Fed to consider "yet another interest rate hike". Last month, Fed chair Jerome Powell said in a speech that the financial system was stable.

The call struck market observers as curious given that investors have expressed no concerns about the banks' financial condition. Trump has criticized Powell and the Fed for increasing interest rates, subjecting Powell to the kind of scathing public critique that is common for senior Trump appointees but which threatens the political independence of the worlds most powerful central bank.

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