Trump Opposes Possible US Rate Hike: ‘We’re Number One; We Should Have Lowest Rates’

September 1, 2026

Washington: US President Donald Trump has opposed the possibility of another interest rate increase, arguing that the strength of the American economy should allow the country to borrow at lower costs.

Trump was responding to a question about Federal Reserve Chairman Kevin Warsh signalling that the central bank could consider raising interest rates. The President said he respected Warsh but made clear that he believed US interest rates were already too high.

“No. I have a lot of respect for him, and he’ll do what he has to do,” Trump said at the White House. “I think our interest rates are too high.”

Trump Says US Should Have Lowest Rates

Trump argued that the United States’ strong economic position and role in the global financial system should translate into lower borrowing costs.

“We’re number one; we should have the lowest interest rates in the world,” he said.

He linked his argument to US trade power, saying countries that benefit from access to the American market should not necessarily have lower borrowing costs than the United States.

“If we wanted to put tariffs or stop doing — we have the right to stop doing business with them, they would go from a so-called elite country to a poverty-stricken country,” Trump said.

“So, we should pay, in my opinion, the lowest interest rates anywhere in the world by far,” he added.

Trump Criticises Fed Approach to Strong Growth

Trump said the Federal Reserve’s approach to strong economic data had changed over the past 25 years.

He argued that positive economic numbers previously led to lower interest rates, while the central bank now views strong growth as a potential inflation risk.

“In the old days, meaning you go back 25 years ago, if we announced good numbers, interest rates went down,” Trump said.

“Now, if you announce good numbers, interest rates go up because they’re so afraid of inflation,” he added.

Trump said the approach could prevent the US economy from achieving stronger growth.

“Every time you do well, we just announced great numbers. And so, now they’re talking about raising interest rates; it’s ridiculous,” he said.

Trump Says Strong Economy Should Mean Lower Rates

The President also rejected the argument that stronger economic growth necessarily leads to higher inflation.

“Because success in growth does not cause inflation; inflation is caused for other reasons,” Trump said.

He argued that stronger economic performance improves the creditworthiness of the United States and should therefore support lower borrowing costs.

“When we do well, we become a better credit; when you become a better credit, you’re supposed to cut rates, not raise rates,” Trump said.

The Federal Reserve operates independently of the White House and sets monetary policy based on its assessment of economic conditions. The central bank generally raises rates to curb inflation and lowers them to encourage borrowing and economic activity when growth weakens.

Changes in US interest rates can also have global consequences, influencing the dollar, international capital flows and borrowing costs in emerging economies, including India.