Trump Threatens Trade Ban Unless Fed Cuts Interest Rates

President Donald Trump has issued a stark warning to the Federal Reserve, threatening to halt US trade with countries where America runs a trade deficit if interest rates are not lowered. The threat came after official figures showed that employers added 162,000 jobs in August, while the unemployment rate remained at 4.1 per cent.

Trump argued that the strength of the US economy justified lower interest rates and claimed the country should have the lowest rates in the world. He then linked his demand to countries with trade deficits, stating 'LOWER THE RATE OR I'LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT.'

The Federal Reserve's current target range for the federal funds rate is 3.5 per cent to 3.75 per cent, set at its latest meeting in July. Trump urged Federal Reserve officials to 'get smart' and become 'PATRIOTS for a change,' suggesting that higher US interest rates create an unfair disadvantage.

The threat ties the president's trade agenda directly to the Federal Reserve's interest-rate decisions, despite the central bank's policy statement noting that inflation remains elevated relative to its 2 per cent goal.