U.S. President Donald Trump fired shots against the Federal Reserve and its Chairman, Jerome Powell. In a tweet following the quarter-point interest rate cut on Wednesday, Trump said the Fed had "no 'guts,' no sense, no vision!"
According to CNBC, the Fed on Wednesday approved the slashing of interest rates to a target range of 1.75 to 2 percent. The quarter-point cut apparently wasn't good news for the U.S. president, who has been critical of the country's current interest levels.
Trump has been calling on the Federal Reserve to cut rates that could put the United States on the same ground as other nations with lower rates. He said his country's rates were an economic disadvantage compared to other countries.
Aside from slower action by the Fed despite a slowing global economy, Wednesday's vote was pretty much divided. Two of the Fed regional presidents who voted against the rate cuts said they would rather keep the rates unchanged, sending the wrong signals to global markets.
Trump and other economic experts were expecting more than just a quarter-point cut as he also called the rates to hit zero in his rants last week. The U.S. president may further be triggered to express disappointment as economists noted that the Fed did not provide positive signals about upcoming rate cuts before 2019 ends.
Over the past few weeks, economic analysts have been pointing to a potential recession as the global economy continues to slow down and the consequences of Trump's trade war begin to kick in.
Amid the criticism, Powell insisted that trade issues were in no way "the business of the Fed." He added that trade policy issues were the problems weighing down on economic forecasts, not the Fed's slow action in cutting rates.
This is the second time this year that the Fed cut interest rates in an underwhelming manner. It is also the second yet since 2008, triggering questions about how the U.S. economy could bolster global growth under pressure.
According to CNN, investors who hoped for a bigger interest rate reduction sold off stocks in a move that rattled global markets. As previously forecasted by finance experts, the Dow shed over 150 points shortly after the Fed announced the cut.
Powell said the U.S. economy is still strong. His sentiments were echoed by the Fed officials who voted against the cut, Kansas City Fed President Esther George and Boston Fed President Eric Rosengren.
During his speech after the cut's announcement, Powell said the Fed will do what it can when necessary but at the moment, they "don't see" the need to further adjust rates for the economy.