Fed's interest rate increases 'don't have to go as fast'

  • Fed's interest rate increases 'don't have to go as fast'

Fed's interest rate increases 'don't have to go as fast'

The president told reporters Wednesday that he believed the drop was a correction, and that the Federal Reserve Bank was to blame for raising interest rates. "They're so tight." He noted of today's market, "It's a correction that we've been waiting for, for a long time". "So you can say that well that's a lot of safety actually, and it is a lot of safety, and it gives you a lot of margins, but I think the Fed has gone insane".

Currency investors took shelter in the safe-haven yen, resulting in steep losses for Japanese exporters, with electronics giant Sony down almost five percent as blue-chip firms flashed red across the trading board. A stock market correction is defined as a decline of at least 10 percent from the high point of the past 52 weeks, suggesting that major USA indices have further to fall.

Money Map Press chief strategist Keith Fitz-Gerald, Fox Business correspondent Kristina Partsinevelos and Capital Wave forecast editor Shah Gilani discuss President Trump's criticism of the Federal Reserve.

Bourses in Paris and Frankfurt both lost more than two%, while London fell 1.3%.

The Dow Jones Industrial Average has plunged more than 800 points, its worst drop in eight months, led by sharp declines in technology stocks.

"The Fed is making a mistake". US consumer price inflation is now above 2 percent annually and the unemployment rate is the lowest in about 40 years. The S&P 500 was down 3.3 percent, and the Nasdaq saw losses of 4.1 percent. Many observers expected that would trigger a sell-off in the stock market as investors flooded their cash into Treasurys.

Trump's comments echo his previous criticisms of recent months, which broke more than two decades of White House tradition of avoiding comments on monetary policy out of respect for the independence of the USA central bank.

Stocks have been under pressure since the yield on 10-year US Treasury bonds jumped above three percent last week, a sudden move that raised fears of an overheating economy, speeding inflation and more aggressive Federal Reserve interest rate increases. "The Fed has gone insane". "But I really disagree with what the Fed is doing, okay?"

Earlier on Tuesday, White House economist Kevin Hassett said the administration respects the Fed's independence and pointed to Trump's nominees to the central bank as evidence of its non-partisan approach to the setting of monetary policy. In Paris, shares in Kering fell almost 10 percent, LVMH over seven percent and Hermes around five percent.