Trump Pushes Gold Higher; 'Not Thrilled' With Fed Raising Interest Rates
(Kitco News)- President Donald Trump has rescued the gold market asprices have significantly bounced off their lows following hiscriticism of the Federal Reserve.
Thursday, in an interview with CNBC, Trump expressed hisfrustration with the U.S. central bank saying that he is “not thrilled” withrising interest rates. He added that higher interest rates could disrupt thenation’s economic recovery.
“I don’t like all of this work that we’re putting into theeconomy and then I see rates going up,” he said in the interview.
"Because we go up and every time you go up they want to raiserates again. I don't really - I am not happy about it. However, at the sametime, I’m letting them do what they feel is best.”
Gold has benefited from Trump's comments, with prices rallying more than $10 since the interview was published. Prior to that,the yellow metal was hovering near a fresh 12-month low.
August gold futures last traded at $1,227.80 an ounce,relatively unchanged on the day.
Trump’s take on the U.S. monetary policy has taken somepolitical pundits by surprise as the central bank is seen as apolitical.
In a comment to CNBC, former Dallas Fed President RichardFisher said that the President was out of line.
“One of the hallmarks of our great American economy is preservingthe independence of the Federal Reserve. No president should interfere with theworkings of the Fed,” he said.
Trump’s statements come the day after Fed Chair Jerome Powell,who was appointed by Trump, presented a relatively optimistic view on the U.S.economy and labor market to Congress.
“The FOMC believes that--for now--the best way forward is tokeep gradually raising the federal funds rate. We are aware that, on the onehand, raising interest rates too slowly may lead to high inflation or financialmarket excesses," he said. "On the other hand, if we raise rates toorapidly, the economy could weaken and inflation could run persistently belowour objective.”
In June, the Federal Reserve signaled that it could hike interest rates two more times this year after already raising rates three times in 2018.
For Kitco News
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