President Donald Trump has for months tried to pressure Federal Reserve chair Jerome Powell to resign from his post if he doesn’t cut interest rates.
Former U.S. Treasury Secretary Larry Summers warned that President Donald Trump may be trying to «scapegoat» Federal Reserve chair Jerome Powell in the event the economy slows down enough to hit a recession.
«He’s looking to set up a scapegoat if the economy performs badly», Summers said during an appearance on ABC News’ This Week. «That’s what this attacking chairman Powell is really about. It’s not really about trying to change policy.»
Newsweek reached out to the White House by email outside of normal business hours on Sunday morning for comment.Why It Matters
Trump has made tariffs the centerpiece of his economic and foreign policy plans, using trade negotiations to try and end conflicts and completely reshape the international trade landscape to more heavily favor the United States.
However, many economists and business leaders have warned that Trump’s plan will cause a recession as the tariffs raise prices for Americans, which could deter buying and prompt more Americans to hold onto their money.
Trump has therefore urged Powell to cut the interest rate in order to spur the economy and get people to spend more money, but Powell has resisted—much to Trump’s frustration.What To Know
The stock market took a hit on Friday after Trump signed a series of executive orders to impose tariffs on over 90 countries, ranging from 10 to 41 percent.
The July Jobs report showed that growth had slowed, showing just 73,000 new jobs—well under the projected 100,000 that the Dow Jones had estimated. Additionally, the jobs reports for May and June were hit with significant revisions that showed very weak growth across those months.
