Trump Demands Rate Cut as Strong Jobs Report Fuels Hike Bets

President Trump has renewed his call for the Federal Reserve to lower interest rates in response to the strong August jobs report. The Bureau of Labor Statistics reported that U.S. employers added 162,000 jobs last month, exceeding the anticipated 53,000. However, this robust job growth increases the likelihood that the Fed will raise rather than lower interest rates at its next meeting.

Trump has been critical of the Fed's decision to keep rates steady and has suggested that he may take action if they don't comply with his request. He tweeted that 'Lower the interest rates because the U.S.A. is a much stronger credit than it was just a short time ago!' and warned that he would stop trading with countries that have a deficit if the Fed doesn't act.

The Fed has been keeping rates at a range of 3.5 to 3.75 percent, citing persistently high inflation above its target rate of 2 percent. Annual inflation sat at 3.7 percent year over year in July, according to the personal consumption expenditures price index. Traders are now pricing in a 60 percent chance that the Fed hikes rates by a quarter point at its next meeting.