As his business advisors finalized a plan to implement mutual measures to every country accusing every country of duties on American imports, President Donald Trump on Wednesday announced that he stressed for low interest rates with his tariff policies Will give
“Interest rates should be reduced, something will happen that will be in hand in hand with upcoming tafs !!! Let’s rock and roll, America !!! Trump said on social media on Wednesday morning.
To maintain the autonomy of the Federal Reserve from politics, the US President traditional also avoids the presence of monetary policy and the presence of the country’s interest rates, which is the scope of the central bank.
However, Trump has not released from practice. At a Videoconference address for the World Economic Forum in Davos, Switzerland in January, Trump said that “the demand is” demand that interest rates fall immediately. “
“I know the interest rates do much better,” he said about Fed officials. He has criticized the Federal Reserve Chair Geom Powell, which he appointed for the term 2026 in 2017.
Trump’s push for low interest rates The purpose is to go hand in hand with punitive measures on business partners.
White House Economic Advisor Kevin Haset on Wednesday said “a lot of action on this”, “is a high priority for the President”, “a high priority for the President.”
Haset said that the White House has started dialogue with another country to perform the ground work to implement such a Tatur, although he accepted the details about which areas or how they would be implemented. “Work in progress”.
Under the rules of the World Trade Organization, member countries have the right to impose taffs on imports. Countries interact at the rates in the WTO that a member country can put on imports from other member countries to determine the maximum tariff amment.
Inflation was loving business
According to government data released on Wednesday, US inflation increased to 3% in January. Last month, what is the annual speed 2.9%.
Trump campaigned on reducing high consumer prices, which he convicted his predecessor, Joe Biden. White House press secretary Karolin Levitt again promoted the increase in previous administration.
“This dialect is an indictment on the lack of inflation crisis and lack of transparency of the administration,” he said during his briefing on Wednesday.
Trump wants to reduce interest rates and inflation, he said. “They believe that inflation will be reduced as a result of the entire government economic approach of this administration.”
However, some economists have warned that a combination of high tariffs and low interest rates will have an adverse effect.
Trump’s plan shows “how the economy works”, Joseph Gagon said, senior companions of Peterson Institute for International Economics.
“Tattifies directly increase prices, this is inflation, but if you do it excessively, cutting interest rates is inflation.” “With today, it would not be a good idea to cut interest rates.”
During the testimony before the Senate Banking Committee on Tuesday, Powell said that Fed did not hurry to cut interest rates as the economy had stabilized. He said inflation, while still above the 2% target of the Fed, what is 2.6% last year, and he said that the labor was cooling without the market, which had an unconnected rate with a rate of 4%.
Gagon was warned of a great business. Trump had already announced its decision to implement 25% TAIF on all steel and aluminum imports starting on March 12.
Duties will be hit to the top American steel supplier Canada, followed by Brazil, Mexico, South Korea and Germany. Additionally, Canada is a pioneer in aluminum exports in the US market.
European Union head Ursula von deer Leyen on Tuesday would not “unanswered the move,” saying that it would trigger hard counterres of the 27-nation, the discovery of potentially targeted reputed American industries bombon, jeans and motorcycles In form of. The European Union Trade Minister on Wednesday held a meeting to determine his next tricks.
China, Mexico and Canada
Last week, Trump imposed an additional 10% tariff on Chinese goods, stating that its purpose was to stop the flow of Fentanel Opioides and their precursor chemicals.
On Monday, China began slapping vengeance over some American goods, including 15% of duties on coal and natural gas imports and 10% of petroleum, agricultural equipment, high emission vehicles and pickup trucks. So the country immediately implemented restrictions on export of some important minerals, and it began an no -confidence investment in American tech giant Google.
Trump delayed Mexico and Canada in creating 25% tariffs on goods for a month – by March 4 – to secure its boundaries for American neighbors and allow interaction on their demands to prevent the flow of illegal drug fertinel. For.
According to US government data, trade imports coming from China, Mexico and Canada may affect around $ 1.323 trillion. It constitutes 43% of US imports and 5% of $ 27 trillion US GDP.
If you increase the average tariff rate from 3% to 10.7% from your current level on the basis of contemporary trade patterns on Canada, Mexico and China, then said Joseph Bruceuelus, the chief economist of the financial advisor firm RSM.
“Business clashes should include the European Union and convert into all-out trade, US economic growth should be expected to return to 2% as Tafs have reduced development and employment, stoking inflation and current account The deficit has to widen, all are higher higher. Interest rates, ”He wrote on the Real Economy Blog of RSM.
Volia Mendoza of VOA contradicts for this report.