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Trump asks whether the Fed chief or China is ‘our bigger enemy’ as the trade war takes a dark turn

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donald trump jerome powellDrew Angerer/Getty Images

  • President Donald Trump lambasted Federal Reserve Chairman Jay Powell in a tweetstorm Friday as his trade war with China escalated.
  • “My only question is, who is our bigger enemy, Jay Powel (sic) or Chairman Xi?” Trump wrote on Twitter.
  • The latest attacks on Powell came as the trade war between the US and China entered a new phase, heightening political risks for the Trump reelection campaign a week after a recession warning flashed.
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President Donald Trump lambasted Federal Reserve Chair Jay Powell in a tweetstorm Friday as his trade war with China escalated and after the central bank signaled it would not lower rates to the extent that the White House wanted. 

“As usual, the Fed did NOTHING!” the president wrote on Twitter. “We have a very strong dollar and a very weak Fed. I will work ‘brilliantly’ with both, and the U.S. will do great…….My only question is, who is our bigger enemy, Jay Powel (sic) or Chairman Xi?” 

The latest attacks on Powell came as the trade war between the US and China entered a new phase, heightening political risks for the Trump reelection campaign a week after a recession warning flashed. China announced earlier Friday it would retaliate against the US with new tariffs on thousands of American products. 

Trump then ordered American companies “to immediately start looking for an alternative to China” and said further actions against the second-largest economy would be announced later Friday. He added that the US would order all carriers including FedEx, Amazon, UPS and the Post Office to search for and refuse fentanyl from China.

“They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen!” Trump wrote on Twitter. “We don’t need China and, frankly, would be far……..better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP.”

In a highly-anticipated speech at the Jackson Hole Symposium less than an hour earlier, Powell failed to signal an aggressive rate cut was ahead. The White House has called on the independent central bank to lower interest rates by up to a full percentage point, an adjustment that would typically only be deployed in a severe downturn.  

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