Trump's 'Rocket Fuel' Interest Rate Cuts Fail to Launch
President Donald Trump has been pushing for interest rate cuts to boost the economy, describing them as 'Rocket Fuel' for growth. However, the Federal Reserve's new chair, Kevin Warsh, said in his latest press conference that inflation continues to run hot but offered no clear guidance on how to fix the problem.
The opposite of what Trump had pledged to voters has occurred: interest rates are rising. The 10-year U.S. Treasury note saw its interest rate shoot up above 4.7% on Friday, surpassing the rate inherited by Trump last year. Despite this, Trump has largely ignored the jump in interest rates and portrayed the economy as booming.
The rise in borrowing costs is weighing heavily on voters ahead of the midterms, with Republicans struggling to show clear progress on affordability. The government is also getting squeezed, spending $827 billion so far this fiscal year to service the national debt, more than it has devoted to national defense.