During a Wednesday broadcast of CNN International's “First Move,” CNN Business editor and international business correspondent Richard Quest, host, and 2024 Republican presidential candidate Donald Trump noted that the Federal Reserve is “either playing politics or they're cutting interest rates by a half-point because things are a little worse than expected, things are getting worse and they need stimulus.”
Host Julia Chatterley played a video of Trump saying: [relevant portion begins around 21:00] “I think that these cuts are an indication that the economy is very bad. Assuming they're not playing politics, either the economy is very bad or they're playing politics. But these were big cuts.”
“Donald Trump is right in some ways. This is either a political stunt or they're halving it because things are slightly worse than expected and they need a stimulus. And I think that's an inevitable position to take. Jay Powell is taking an uncomfortable position by saying we've waited a long time and we're halving it because we thought we could. This is not a crisis, this is not a panic, this is an aggressive move,” Quest said.
Chatterley said:[W]”Even if growth stays at 2 percent, I'm more concerned than I was three months ago about whether inflation will be contained. Now they're going to do everything in their power to make sure unemployment doesn't go up any more. If they can do that, I think we'll have a soft landing.”
Quest responded, “If they can do that, because what he's leaning towards is a snowball rolling down a hill. … So it's either a snowball rolling down a hill that needs to slow down or you have a cake in the oven that needs to be taken out. Whichever you prefer, that's up to you, but that's what this half a percentage point is for. And two more things: Jay Powell acknowledged today that if they'd known the employment numbers sooner, they could have, could have, should have, would have done it in July. At the end of the day, I think this isn't a crisis, this is just a rush job.”
Quest also said the cuts would have no impact on the economy ahead of the election.
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