Trump Urges Fed to Match Europe’s Record-Low Rate

Following Europe’s decision to slash interest rates into negative territory as part of a forthcoming stimulus package, President Donald Trump has publicly praised the move and called on the Federal Reserve to take similar action. Expressing his views on Twitter, Trump criticized the Fed for not being more aggressive in lowering rates and suggested that the US should aim for rates below zero like Europe.

The European Central Bank (ECB) has maintained negative interest rates since 2016, a move not widely expected to be replicated in the US due to differences in economic circumstances. The ECB’s unprecedented approach is governed by its objective to steer inflation towards a target just below 2% over the medium term, as outlined in an official statement.

The impact of negative interest rates on Europe’s economy has been mixed. While the Euro and inflation levels saw improvement post-2016, the strategy has presented challenges, particularly for commercial banks heavily involved in lending activities crucial for sustaining the EU economy, such as mortgages and small business financing.