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• According to Trump, the U.S. should have the “lowest rate of any country in the world,” reviving his argument that the country’s economic strength warrants cheaper financing.
• Trump called Friday’s data a “great jobs number,” adding that it was “breaking all estimates.”
• August jobs report showed 162,000 new jobs and the unemployment rate steady at 4.1%.

President Donald Trump renewed his push for lower interest rates Friday, but this time linked his demand to a new trade threat, saying the U.S. could stop trading with countries that run surpluses with America if the Federal Reserve does not cut rates.

“Lower the rate or I’ll stop trading with countries with which we have a deficit,” Trump wrote in a post on Truth Social, adding that a stronger U.S. economy and credit profile should justify lower borrowing costs. According to the President, the approach would be “better than tariffs.” 

The comments came after the August jobs report, which showed the U.S. economy added 162,000 jobs, well above the 56,000 increase economists had expected. The unemployment rate held at 4.1%.

Trump Hails Jobs Report, Calls For Lower Rates

Trump called Friday’s data a “great jobs number,” adding that it was “breaking all estimates.” According to him, the strength of the U.S. economy should translate into lower borrowing costs for the country.

“A strong country means a lower interest rate - it’s a better credit,” Trump wrote. He also reiterated calls for the U.S. to have the “lowest rate of any country in the World,” harking back to what he described as “the old days.”

The comments add to Trump's ongoing pressure on the Fed to lower interest rates. The central bank, however, has maintained that monetary policy decisions are based on its assessment of inflation, employment and broader economic conditions rather than political demands.

Fed Outlook Hinges On Jobs, Inflation

In an interview with CNBC, White House NEC director Kevin Hassett said the next major test will be the consumer price index (CPI) due next week. “If the CPI continues to be that favorable in the next report, the argument for holding steady would be pretty strong,” he stated.

His comments come after Federal Reserve Governor Christopher Waller said Thursday that the central bank could keep rates steady if inflation continues to cool. At a separate Reuters event, he also noted that liquid U.S. government debt no longer commands a premium, thereby raising the neutral level of interest rates. 

U.S. equities were mixed in morning trade on Friday following the jobs report. The SPDR S&P 500 ETF (SPY) dipped 0.23%, the SPDR Dow Jones Industrial Average ETF (DIA) fell 0.50%, while the Nasdaq-100 tracking Invesco QQQ Trust (QQQ) moved 0.41% higher. 

SPY and QQQ were among the top trending tickers on Stocktwits at the time of writing. Retail sentiment around SPY trended in ‘bearish’ territory over the past day, while sentiment around QQQ improved to ‘bullish’ from ‘neutral’ territory.

Read also: Apple’s New Foldable iPhone Could Cost $2,000, Citi Says: TSMC, Amphenol Among Stocks To Watch

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