Trump blasts Federal Reserve as 'stubborn child' on rate policy

President Donald Trump renewed his attack on the Federal Reserve on Monday, declaring that the central bank “doesn’t know what it is doing” when it comes to boosting the U.S. economy.

In a series of posts on Twitter, Trump reignited his feud with the central bank and Fed Chair Jerome Powell — the top policy-maker he appointed. The president accused the Fed of raising rates far to fast⁠ last year, with too much large scale tightening.

As the global economy slows, benchmark U.S. rates are among the highest of large industrialized economies. In some ways, it enhance the appeal of American assets for investors hunting for higher yields, such as stocks. 

RELATED: Take a look at the U.S. states where Americans pay the highest state income taxes: 

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States where Americans pay the highest in state income taxes
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States where Americans pay the highest in state income taxes

California

State income tax: 1% to 13.3% 

Maine

State income tax: 5.8% to 10.15%

Oregon

State income tax: 5% to 9.9%

Minnesota

State income tax: 5.35% to 9.85%

Iowa

State income tax: 0.36% to 8.98%

New Jersey

State income tax: 1.4% to 8.97%

Vermont

State income tax: 3.55% to 8.95%

Washington, DC

State income tax: 4% to 8.95%

New York

State income tax: 4% to 8.82%

Hawaii

State income tax: 1.4% to 8.25%

Wisconsin

State income tax: 4% to 7.65%

Idaho

State income tax: 1.6% to 7.4%

South Carolina

State income tax: 0% to 7%

Connecticut

State income tax: 3% to 6.99%

Arkansas

State income tax: 0.9% to 6.9%

Montana

State income tax: 1% to 6.9%

Nebraska

State income tax: 2.46% to 6.84%

Delaware

State income tax: 2.2% to 6.6%

West Virginia

State income tax: 3% to 6.5%

Georgia

State income tax: 1% to 6%

Kentucky

State income tax: 2% to 6%

Louisiana

State income tax: 2% to 6%

Missouri

State income tax: 1.5% to 6%

Rhode Island

State income tax: 3.75% to 5.99%

Maryland

State income tax: 2% to 5.75%

North Carolina

State income tax: 5.75%

Virginia

State income tax: 2% to 5.75%

Oklahoma

State income tax: 0.5% to 5.25%

Massachusetts

State income tax: 5.1%

Alabama

State income tax: 2% to 5%

Mississippi

State income tax: 3% to 5%

Utah

State income tax: 5%

Ohio

State income tax: 0.495% to 4.997%

New Mexico

State income tax: 1.7% to 4.9%

Colorado

State income tax: 4.63%

Kansas

State income tax: 2.7% to 4.6%

Arizona

State income tax: 2.59% to 4.54%

Michigan

State income tax: 4.25%

Illinois

State income tax: 3.75%

Indiana

State income tax: 3.3%

Pennsylvania

State income tax: 3.07%

North Dakota

State income tax: 1.1% to 2.9%

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Trump boasted that major stock benchmarks are on track to have “one of the best months of June in U.S. history.”

Last week, the Fed held benchmark interest rates steady near 2.25%, with analysts widely expecting a new easing cycle to begin as early as next month. However, Trump implicitly blasted the policy decision, accusing the Fed of acting like a “stubborn child” on its refusal to ease policy amid a deceleration.

A slowing U.S. economy needs rate cuts, Trump said, in order to “make up for what other countries are doing against us. Blew it!”

Trump’s hammers Powell (again)

For months, Trump has been sharply criticizing Powell on policy — first, for the Fed’s rate-hiking campaign last year, then for refusing to cut rates in the face of a slowing economy and an escalating fight with China on trade.

In December, Trump reportedly floated the idea of ousting Powell from the Fed, an idea that most market observers said at the time was neither legal nor beneficial to markets. Although Trump backed off the idea, he has still repeatedly teed off on the Fed chief.

The Fed has come under attack from past presidents.

In an interview with NBC’s “Meet the Press” which ran on Sunday, Trump stressed that he is not pleased with Powell, claiming the Fed raised rates “too fast” and that he does not think Powell is doing a “very good job.”

Trump went on to deny that he threatened to demote Powell, but claimed that he would have the authority to do so.

“I didn’t ever threaten to demote him... “I’d be able to do that if I wanted, but I haven’t suggested that,” Trump said. When asked last Tuesday if he would demote Powell, Trump played it coy.

“Let’s see what he does.”

Donovan Russo is a writer for Yahoo Finance. Follow him @Donovanxrusso.

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