President Donald Trump Wednesday slammed Federal Reserve Chairman Jay Powell and the agency's members as "boneheads" while calling for interest rates of "zero, or less."
"The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt," Trump posted on Twitter. "INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power, and balance sheet."
He added that the United States should "always be paying the lowest rate. No Inflation! It is only the naïveté of Jay Powell and the Federal Reserve that doesn't allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of 'Boneheads.'"
Banking analyst Dick Bove of Odeon Capital Group told CNBC that it would be "wonderful" for the United States if the Fed would lengthen maturities on debts with rates below 1%, at least to the government, but he thinks it's an open question over whether the move would benefit the U.S. economy.
In addition, CNBC reports that during his 2016 campaign, Trump suggested a plan involving renegotiating debt, but the idea was dismissed by experts who said it could drive Treasury yields higher while threatening the U.S. dollar as the world's reserve currency and causing problems with the country's standing with creditors.
The Fed's benchmark overnight lending rate is currently targeted at between 2% and 2.25%, the highest rate of any Group of Seven nation. Trump has pushed to bring the rate down to be more in line with that of other nations, which have interest rates of almost zero percent.
Trump has already criticized Powell several times over the interest rate issue.
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