Billionaire Elon Musk said Sunday that the Federal Reserve was “foolish” for not cutting interest rates sooner following a disappointing jobs report that raised concerns about an economic slowdown.
“The Fed needs to lower interest rates,” Musk said in a post on his X account. “They’re stupid for not lowering rates before now.”
Musk’s comments came after the Federal Reserve met last week and left interest rates unchanged at a range of 5.25% to 5.5%, the highest level the central bank has held interest rates at in 23 years since July of last year.
Policy makers said inflation “remains modestly above” their 2% target, and that June data showed inflation had fallen to 3%.
Federal Reserve Chairman Jerome Powell said policymakers have not yet decided and will evaluate inflation and labor market data before taking a decision, but hinted that a rate cut is possible at the next Fed meeting.
“The question is whether the full set of data, the evolving outlook, and the balance of risks are consistent with growing confidence in inflation and the continued strength of the labor market,” Powell said. “If that test is passed, a rate cut could be considered as early as the Fed’s next meeting in September.”
Musk made the comments in response to a post by X that said billionaire investor Warren Buffett’s Berkshire Hathaway had increased its stockpiles of cash equivalents and short-term government bonds after reducing its holdings of stocks, including its largest holding, Apple.
“He’s clearly expecting some kind of correction or he simply can’t find a better investment than Treasury bonds,” Musk said.
The latest jobs report released by the Labor Department on Friday showed the U.S. economy added 114,000 jobs, below the 175,000 expected by economists at the London Stock Exchange Group.
Slower-than-expected job growth led to a surprise rise in the unemployment rate, rising to 4.3% amid expectations that it would remain at 4.1%.
