Donald Trump has claimed the US Federal Reserve is keeping interest rates low to boost the popularity of President Barack Obama.
The US Republican presidential candidate said Federal Reserve chief Janet Yellen was “obviously political” and had created a “false” stock market by keeping interest rates low.
Economists and commentators were quick to dismiss his comments.
Paul Krugman of the New York Times said he displayed “ignorance and paranoia”.
Rates are unlikely to rise until there is a new president, according to Mr Trump. When that happens, the stock market is likely to go “way down”, he said in an interview with US channel CNBC.
“She [Federal Reserve Chair Janet Yellen] is obviously political and she’s doing what Obama wants her to do,” Mr Trump said.
Responding to his comments, Minneapolis Federal Reserve president Neel Kashkari told CNBC that at Federal Reserve meetings “politics simply does not come up”.
“We look at the economic data,” he said.
When asked about political pressure on the Federal Reserve, Atlanta Federal Reserve president Dennis Lockhart said: “I don’t see the world that way.”
In a tweet Paul Krugman, a professor of economics and commentator for the New York Times, said: “In ordinary times this combo of ignorance and paranoia would be shocking. In this election, who’ll even notice.”
Earlier this month, Ms Yellen said the case for raising US interest rates had “strengthened”.
Speaking at an annual meeting of central bankers, Ms Yellen was cautiously upbeat about the US economy.
She said economic growth and a stronger jobs market meant “the case for an increase in the federal funds rate has strengthened in recent months”.
Savers hit
Mr Trump said that while low interest rates had been good for his property business, savers had been hit.
“The ones that did it right, they saved their money. They cut down on their mortgages… now they’re getting practically zero interest on the money that they worked so hard for.”
