US President Donald Trump has blasted the Federal Reserve describing it as the "only problem" for the US economy, as top officials discussed a growing rout in stock markets.
US President Donald Trump and the Federal Reserve chairman Jerome Powell. Photo: AFP
Stocks fell again today amid concern about slowing economic growth, the government shutdown and reports that Trump had discussed firing Federal Reserve chairman Jerome Powell.
The S&P 500 index is on track for its biggest percentage decline in December since the Great Depression.
In a tweet Mr Trump said the Federal Reserve is like a powerful golfer who can't score because he can't putt.
Saudi Arabia has now agreed to spend the necessary money needed to help rebuild Syria, instead of the United States. See? Isn’t it nice when immensely wealthy countries help rebuild their neighbors rather than a Great Country, the U.S., that is 5000 miles away. Thanks to Saudi A!
— Donald J. Trump (@realDonaldTrump) December 24, 2018
I am all alone (poor me) in the White House waiting for the Democrats to come back and make a deal on desperately needed Border Security. At some point the Democrats not wanting to make a deal will cost our Country more money than the Border Wall we are all talking about. Crazy!
— Donald J. Trump (@realDonaldTrump) December 24, 2018
The President has gone after Mr Powell several times now, saying he's "not thrilled" with his own appointee and the Fed should do more to help him boost the economy.
Mr Trump continually boasted about Wall Street's steep climb during the first year of his presidency, but has sought to deflect blame since markets hit a rough patch this year.
Yesterday the US Treasury Secretary Steven Mnuchin took the unusual step of calling the chief executives of America's six largest banks in a bid to soothe market jitters.
Today, he called top market regulators and officials from the US central bank to allay fears about the economy.
Mr Mnuchin hosted the call with the President's Working Group on Financial Markets to "discuss co-ordination efforts to assure normal market operations", according a treasury statement.
The board of governors of the US Federal Reserve System, the Securities and Exchange Commission and the Commodities Futures Trading Commission are on the working group.
What did the US Treasury say?
A statement from the treasury divulged details of Mr Mnuchin's discussions with the top US banks - a rare step for the department.
"The [bank's chief executives] confirmed that they have ample liquidity available for lending to consumer, business markets, and all other market operations," the Treasury statement said.
"We continue to see strong economic growth in the US," Mr Mnuchin added.
Earlier, Mr Mnuchin tried to dismiss reports that President Trump had discussed the possibility of firing the Federal Reserve chairman, after the bank raised interest rates last week.
The US treasury secretary tweeted that he had spoken to the president, who insisted he "never suggested firing" Jerome Powell and did not believe he had the right to do so.
Why are investors worried?
This year's Christmas Eve trading was the worst ever for US stocks.
The Dow Jones Industrial Average dropped by 653 points, falling below 22,000.
The S&P 500 entered so-called "bear market" territory.
US investors are worried about a range of factors including slowing economic growth at home and internationally, though US economic data is still strong.
Mr Trump's ongoing trade war with China as well as Defence Secretary Jim Mattis's surprise resignation have also unsettled investors.
In addition, a partial US government shutdown began at midnight on Friday after Congress refused to fund President Trump's planned US-Mexico border wall.
The shutdown could continue until the opening of the next Congress on 3 January.
-BBC
