White House calls Fed rate hike ‘quite regrettable’ as tensions mount over monetary policy

The White House labeled the Federal Reserve’s latest interest rate hike “quite regrettable,” a phrase that lands somewhere between diplomatic frustration and a barely concealed grimace. The Fed raised its benchmark rate by 25 basis points on September 16, pushing the target range to 3.75%-4%, and the administration is not pretending to be happy about it. This is the first rate increase since July 2023, ending a three-year stretch of relative stability. The timing could hardly be worse for an administration heading into midterm season with borrowing costs climbing. The Fed’s inflation problem won’t go away quietly The decision was unanimous under Chair Kevin Warsh, who Trump himself appointed back in May. That detail makes this whole situation a bit awkward. Trump picked Warsh after criticizing his predecessor’s policies as inadequate, presumably expecting a more accommodative approach to rates. Instead, Warsh is hiking. The reason is straightforward: inflation has exceeded the Fed’s 2% target for over five years running, and the forces pushing prices higher aren’t fading. Oil price spikes tied to the US-Iran conflict have added fuel to an already overheated price environment. Ongoi...