Donald Trump launched a fresh attack on the chair of the Federal Reserve after the US jobs market suffered a sharp slowdown over the summer.
The world’s largest economy added just 73,000 jobs in July – fewer than the 110,000 expected – reviving hopes of a September interest rate cut.
And figures for May and June were lowered by 258,000 in an unusually large revision by the US Bureau of Labor Statistics (BLS). In retaliation, Trump last night said he would sack BLS head Erika McEntarfer.
It came as US stocks tumbled after Trump slapped tariffs on trading partners. The Dow Jones Industrial Average fell 1 per cent yesterday afternoon, while the S&P 500 dropped 1.2 per cent. The tech-focused Nasdaq was down 1.7 per cent.
European stocks were also rocked by Trump’s trade war, with Germany’s Dax losing 2.7 per cent and Paris’s Cac index dropping 2.9 per cent. The UK got off lightly as the FTSE 100 fell 0.7 per cent, or 64.23 points, to 9068.58.
Pharmaceutical firms were among the biggest fallers in London after Trump demanded lower prices. AstraZeneca fell 1.9 per cent and GSK dropped 1.5 per cent.
Annoyed: Donald Trump launched a fresh attack on the chair of the Federal Reserve after the US jobs market suffered a sharp slowdown over the summer
The retreat came as revised figures showed the US economy added just 14,000 jobs in June, a figure revised from a previously reported 147,000.
Payrolls for May were slashed by 125,000 to a gain of 19,000 jobs. The BLS described revisions as ‘larger than normal’.
Atakan Bakiskan, US economist at Berenberg, said: ‘The July report provided ammunition for those expecting a Fed rate cut in September.’
‘This data has led to a rapid recalibration of US interest rate expectations,’ Kathleen Brooks, research director at XTB, said. On his social media platform Truth Social, Trump wrote: ‘Too little, too late. Jerome ‘Too Late’ Powell is a disaster. DROP THE RATE! .. Tariffs are bringing billions of dollars into the USA!’
The President has branded the central bank chair a ‘stubborn moron’, saying he ‘must lower interest rates now’.
‘If he continues to refuse, the board should assume control and do what everyone knows has to be done,’ he added.
Reports last month suggested Powell’s future could be in doubt after Trump met congressional Republicans to discuss sacking him. But the President later insisted he would only fire the central bank boss if he were guilty of fraud.
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