Trump’s new China tariff was a shot at Fed Chair Jerome Powell: Peter Schiff
President Trump’s new 10 percent tariff on China was meant as a direct shot at Federal Reserve Chairman Jerome Powell, according to Euro Pacific Capital CEO Peter Schiff.
“I think Trump was sending a message to Powell, not to China,” Schiff on Thursday told FOX Business’ Liz Claman on “The Claman Countdown.” “This was basically Trump’s insurance policy to make sure the Fed keeps cutting.”
Trump said Thursday the U.S. is going to impose an additional 10 percent tariff on another $300 billion worth of Chinese goods, which will take effect on Sept. 1. This comes after the Federal Reserve lowered its benchmark interest rate by 25 basis points, or a quarter of a percentage point.
Schiff questions whether Powell was being honest about why the central bank decided to cut rates.
“Powell was not honest about why the Fed was cutting. He’s trying to pretend it’s because of concerns about the overseas economies; it’s really the U.S. economy that is driving the Fed,” he said.
In addition, Schiff predicts that the Federal Reserve will go back to quantitative easing.
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“It was a mistake when the Fed went to zero the last time. It’s going to be an even bigger mistake when they do it next time and they’re also going to go back to quantitative easing. They announced yesterday the end of quantitative tightening, but the next step is to go back to QE [quantitative easing]. And QE4 is going to be bigger than QE 1, 2 [and] 3 combined.”