Trump threatens trade war if rates aren’t cut after strong jobs report

Julia Shapero Fri, September 4, 2026 at 5:32 PM UTC

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President Trump called on the Federal Reserve to lower interest rates Friday after the August jobs report came in stronger than expected, threatening to cut off trade with several countries if the central bank doesn’t budge.

The Bureau of Labor Statistics reported Friday that U.S. employers added 162,000 jobs last month, well above the 53,000 that economists were anticipating.

Trump touted the “great” jobs numbers Friday before quickly turning his attention to the Fed, which he has long pushed to slash rates.

“Lower the interest rates because the U.S.A. is a much stronger credit than it was just a short time ago!” he wrote in a post on Truth Social. “A STRONG COUNTRY MEANS A LOWER INTEREST RATE - IT’S A BETTER CREDIT.”

“Without the United States agreeing to allow them their big surpluses, and we could stop that immediately, they would no longer be considered financially ELITE!” he added. “LOWER THE RATE OR I’LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT.”

The Fed has held rates steady at a range of 3.5 to 3.75 percent at its last five meetings, as inflation has remained persistently above the central bank’s target rate of 2 percent.

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Annual inflation sat at 3.7 percent year over year in July, according to the personal consumption expenditures price index, the Fed’s preferred measure of inflation.

However, Friday’s job numbers appear to increase the chances that the central bank raises rather than lowers rates. The latest data alleviates concerns that higher rates are weakening the labor market and allows the Fed to turn its attention to curtailing inflation.

Traders are now pricing in a 60 percent chance that the Fed hikes rates by a quarter point at its next meeting this month, according to CME FedWatch, which tracks bets placed on future central bank decisions.

Trump touted Fed Chair Kevin Warsh as a “great new leader” Friday even as he ramped up pressure on his pick to run the central bank. The president frequently feuded with Warsh’s predecessor, Jerome Powell, over rate cuts, threatening to fire him on several occasions.

“The Fed Board, with its great new leader, must get smart - BE PATRIOTS for a change,” Trump said. “High interest rates put the U.S.A. at a very unfair disadvantage, and I won’t allow that to happen!”

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