The Globe and Mail reports in its Wednesday, Sept. 9, edition that President Donald Trump's confusing connection between U.S. interest rate policy and trade relations sparked more confusion. A Reuters dispatch to The Globe reports that this presents Federal Reserve chair Kevin Warsh with a chance to distance himself from Mr. Trump and enhance his credibility by advocating for a rate increase this month.
Friday appeared to be a positive day for the President regarding the economy, with August United States payroll gains tripling forecasts and previous job data revisions. However, record-high diesel prices could increase inflation. Tepid wage gains in the employment report might lead the Fed to maintain current rates as it anticipates an inflation update before its upcoming meeting.
However, instead of staying focused on the positive August jobs readout, Mr. Trump quickly, and somewhat inexplicably, turned to the Fed, telling it what it should do and threatening what he would do if it didn't follow suit.
Commentators typically supportive of Mr. Trump are ignoring his comments altogether. TS Lombard economist Dario Perkins says, "Warsh will be credible when Trump starts calling him an idiot!"
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