Trump and Warsh Clash Over Interest Rates Ahead of Key Federal Reserve Decision

President Donald Trump is increasingly vocal about his desire for lower interest rates, putting him at odds with Federal Reserve Chairman Kevin Warsh. Despite initially giving a 'pass' to Warsh after his nomination this year, Trump has been pressing for a rate cut in recent weeks.

The Fed's decision on interest rates is due out Wednesday, and market odds are currently at over 90% that the central bank will increase rates. The target inflation rate is 2%, but August's annual inflation reading came in at 3.4%.

Trump has claimed that higher interest rates cost the country more on its debt and have put the US at a 'very unfair disadvantage'. He wants to see rates come down, possibly even as low as 1% or half a percent.

Economists warn of potential risks associated with a rate hike, including the possibility of pushing growth below potential, which could lead to layoffs, rising unemployment, and a negative economic cycle.