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WSJ: The Moves That Backfired on Trump and Drove Interest Rates and Inflation Higher
The Consumer Price Index rose 0.4% in August and the Fed lifted its benchmark rate by a quarter point, keeping mortgages and car loans expensive.
- Economic indicators have worsened for President Trump's administration this month, as inflation persists and the 10-year Treasury yield recently hit its highest level since 2007.
- Advisers initially anticipated that tighter spending and deregulation would reassure bond investors, but the intended fiscal restraint never materialized as administration policies introduced new price pressures instead.
- The Labor Department reported the Consumer Price Index rose 3.4% over the past year, while gasoline prices increased 3.9% in August, prompting the Federal Reserve to set its benchmark rate at 3.75 to 4%.
- Despite Trump's public demands for the federal funds rate to reach 1%, mortgages and car loans remain expensive for consumers, complicating the administration's economic goals.
- Former Republican Senate aide Jessica Riedl called the inflation woes "entirely predictable," citing tax cuts and new spending, while tariffs, immigration restrictions, and energy costs from the Iran conflict continue to aggravate price pressures.
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Moves That Backfired On Trump and Spiked Interest Rates
“In the early days of President Trump’s second term, his economic advisers laid out a simple theory: Show the bond market that Washington was serious about closing its gaping deficits, and long-term interest rates would fall on their own. Trump could leave the Federal Reserve alone,” the Wall Street Journal reports. “It hasn’t worked out […]
·New York, United States
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Coverage Details
Total News Sources3
Leaning Left1Leaning Right0Center2Last UpdatedBias Distribution67% Center
Bias Distribution
- 67% of the sources are Center
67% Center
L 33%
C 67%
Factuality
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