Fed ‘has gone crazy’ as it raises interest rates

Fed ‘has gone crazy’ as it raises interest rates

President Donald Trump said the Federal Reserve is moving too fast with interest-rate increases and dismissed concerns about inflation, extending his run of criticism that central bankers have largely disregarded as they push ahead with higher borrowing costs.

"The Fed has gone insane", he told reporters on Wednesday as he arrived in Pennsylvania for a campaign rally.

"The Fed has gone insane", Mr. Trump told reporters while traveling to Erie, Pennsylvania, for a campaign rally.

He described the path of rate increases - most recently to a level of 2-2.25% - as "crazy", adding that the stock market reaction was the "correction that we've been waiting for". "But I really disagree with what the Fed is doing, OK?"

And while stocks could get a boost from strong corporate earnings, there are concerns the USA trade conflicts will start to undermine profits.

The 10-year Treasury yield rose to 3.22 percent from 3.20 percent late Tuesday after earlier touching 3.24 percent. As stocks go down, tech goes down more than the stock market, ' she said.

The Dow Jones Industrial Average plummeted 832 points on Wednesday, recording its largest single-day point drop since February.

As of 10:00 am GMT, Dow futures plunged 238 points, futures on the S&P 500 sank 22.5 points, while Nasdaq futures were down 49.5 points.

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USA consumer price inflation is now above 2% and the unemployment rate is the lowest in about 40 years. "It's all about investors rethinking their exposure to stocks".

A spike in Treasury yields and solid United States economic data have sparked concerns that the Federal Reserve may pick up the pace of its interest rate hikes.

The markets have been on a historic climb - with the Dow and S&P each notching dozens of new highs since 2016 - buoyed by a strong US economy and solid corporate earnings.

Fed Chairman Jerome Powell is aiming to extend the second-longest USA economic expansion on record by moving interest rates up just quickly enough to prevent overheating, but not so rapidly that the central bank chokes off growth.

Currency investors took shelter in the safe-haven yen, resulting in steep losses for Japanese exporters, with electronics giant Sony down almost five percent as blue-chip firms flashed red across the trading board.

The current benchmark interest rate is 2 to 2.25 percent.

Ivan Feinseth, Chief Investment Officer at Tigress Financial Partners, said that although the sell-off caught him off-guard, he thought many investors were unduly frightened by the prospect of rising rates. The S&P 500 lost 94 points, or 3.3 percent, to 2,785.

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