Stephen Moore, a former senior economic adviser to President Donald Trump, told Newsmax on Wednesday that 3% GDP growth in the second quarter likely won't spur the Federal Reserve to cut interest rates as Trump has demanded.
"I think it's going to have potentially the opposite effect," Moore said on "Wake Up America." "I think that the Fed is going to say, Oh, the economy is doing great. We don't need to do a rate cut. Here's the problem with the Federal Reserve Board, and this is something that [businessman] Steve Forbes and I have been saying for a long time: The Fed doesn't like economic growth."
He added: "They think economic growth causes inflation, which is crazy because when the economy produces more apples, the price of apples falls — it doesn't rise. So I think, if anything, paradoxically, that this will actually mean that [Fed Chair] Jerome Powell will probably not cut interest rates."
Following its Wednesday meeting, the Fed is set to release its policy statement at 2 p.m. EDT. The central bank is expected to leave interest rates unchanged — an outcome that is "not going to make Donald Trump very happy," Moore said.
Trump has suggested cutting the benchmark interest rate from the current 4.25%-4.50% range to as low as 1%, a move that many economists argue would boost inflation.
Moore also said that "the big story" from the news of 3% GDP growth is "an economy that is growing twice as fast now as it did under [former President] Joe Biden."
"We're seeing lots of jobs," he said. "We're seeing tame inflation. It is really a beautiful picture. The stock market, the S&P 500 and the Nasdaq, are at record highs or at or near those. So it's hard to see anything to complain about. I'm sure Democrats will find something they don't like."
The author of "Trumponomics" added that he predicted that "we'd get to 3% growth" but "didn't think it would happen so quickly."
"Boy, this makes you feel good about America," Moore said. "The direction of the country is good … so, I'm overjoyed."
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Nicole Weatherholtz ✉
Nicole Weatherholtz, a Newsmax general assignment reporter covers news, politics, and culture. She is a National Newspaper Association award-winning journalist.
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