Trump Threatens Trade Restrictions as Fed Considers Rate Hike Amid Strong Jobs Report
The US jobs market has exceeded expectations, adding 162,000 jobs in August according to the Labor Department's latest report. This strong performance has increased the likelihood of a quarter-point interest rate hike by the Federal Reserve at their next meeting.
With the probability of a hike rising from around 50% to over 58%, as tracked by CME FedWatch, the Federal Reserve may use this data to justify further tightening of monetary policy. This would aim to bring inflation down to the target rate of 2%.
President Donald Trump has responded to the report by calling on the Federal Reserve to lower interest rates, stating that a strong economy means low interest rates. He also threatened to impose trade restrictions on countries with which the US has a deficit, arguing that this would be more effective than tariffs.