Trump to Kudlow: ‘This country should have the lowest interest rates in the world’

Fox Business ^ | February 10, 2026 | Jasmine Baehr

[Miami Rebel]

President Donald Trump said the U.S. should have the "lowest interest rates in the world" and argued that rate cuts would significantly reduce federal borrowing costs during an interview Tuesday on FOX Business’ "Kudlow."

"This country should have the lowest interest rates in the world," Trump told host Larry Kudlow. "We keep the world going."

Trump tied interest rates to government interest expenses, saying that changes of a few points could significantly alter federal finances.

"Every point is $600 billion," Trump said. "All he has to do if we went down two points, we don't have a deficit anymore," he claimed.

Trump also pointed to recent market milestones as evidence of economic strength, telling Kudlow he remembers predictions that the Dow Jones Industrial Average reaching 50,000 would be considered a "miracle" by the end of a presidential term.

"I remember when I first won, they said if he gets the Dow up to 50,000 by the end of his fourth year, he will have done miracles," Trump said. "And we’re at the end of the first year."

Trump added, "We’ve had a very good run, and we want to keep it going."

Trump credited falling energy prices for easing costs, telling Kudlow he recently saw gas prices as low as $1.85 in Iowa and saying prices in other parts of the country had "broken $2 a gallon."

"And that’s like a major tax cut," Trump said.

In the interview, Trump pushed back on the idea that strong growth should automatically prompt tighter monetary policy, arguing that markets and policymakers react negatively to inflation concerns.

"We’re old enough to remember when the stock market, when there was good news, the market went up and was bad news, the market went down," Trump said. "That’s the way it should be."

Trump suggested that dynamic has shifted, claiming markets can fall on positive economic news because of inflation fears and expectations about rates.

"They have the yips," Trump said, comparing the reaction to golfers who "can’t sink a three-foot putt" when they hear the word inflation. "Well, growth doesn’t mean inflation."

"We have to go back to the old system when we have good news, the market should go up, and we have bad news, the market should go down," Trump said, adding, "We’ll take care of inflation as it comes."

Warsh nomination Trump praised Kevin Warsh, his nominee connected to the Federal Reserve, in the interview’s discussion of monetary policy, saying Warsh would be influential.

"I think he’s somebody that’s going to be a real influencer," Trump said. "I think he agrees with what I’m saying."

Trump argued the U.S. has historically maintained comparatively low borrowing costs.

"Let’s go back again. Another 20, 25 years. We were always the lowest interest rate," Trump said. "We used to pay like almost nothing."

He then contrasted that with today, claiming, "Now we’re like number 38 because we have had stupid people running our country."

Switzerland tariffs Trump illustrated his view by recounting a dispute with Switzerland, which he said benefited from low tariffs and trade imbalances with the United States.

"We had an incident with a very nice country, Switzerland," Trump said. "They were paying no tariffs, sending stuff over here like nobody could believe. And we had a $42 billion deficit and we weren’t taking anything."

"I said, ‘You may be a small country, but we have a $42 billion deficit with you,’" he added.

Trump said he initially imposed a 30% tariff on Swiss imports before later raising it to 39% following pushback from Swiss officials.

The U.S. later agreed to lower tariffs on certain Swiss goods to 15% from 39% under a trade framework announced last year, Reuters reported.

In a wide-ranging exchange with Kudlow, Trump sharply criticized Federal Reserve Chair Jerome Powell, arguing rates should be lower.

"He’s so bad that, I mean, interest rates should have been cut. We should be two points lower," Trump said.

Kudlow closed the interview by thanking the president for his time.

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TOPICS: Business/Economy
KEYWORDS: economy; hesclueless; interestrates; rates

[Miami Rebel]

I've been a financial professional for 45 years, but I cannot see what President Trump's argument is. As the jobs number indicate, we're in a fairly strong economy. Lowering short-term rates would exacerbate inflation and, counter-intuitively, pressure long-term rates higher, including, of course, mortgage rates.

[9YearLurker]

Any market can be subject to oversupply—as in more US debt than the world wants to buy with a low return. And that of an over-indebted, corrupt and declining power?

[proxy_user]

Every time Trump addresses this topic, the 10-year goes up 20 basis points.

[Starboard]

“we’re in a fairly strong economy”

***********

It does seem that way but with consumer debt running at record highs its hard to understand where the money comes from to drive the economy forward. As I’m sure you know there’s a lot of talk about the K-shaped economy.

Treasury yields were up after the payrolls report.

[Leaning Right]

> Trump said. “All he has to do if we went down two points, we don’t have a deficit anymore,” he claimed. <

Trump is being wildly optimistic there. Congress will continue to over-spend regardless of what interest rates are.

Only the veto pen can stop it. But a few folks here have argued that a presidential veto just doesn’t make sense at this time. It’s too much to ask.

Oh well. Maybe they’re right.
But then what?

[sphinx]

Maybe if the fedgov stopped spending money like a drunken sailor?

Of course, that would mean reforming entitlements, including Social Security, Medicare and Medicaid.

[Justa]

“...but with consumer debt running at record highs its hard to understand where the money comes from to drive the economy forward”

Wut? People who go into debt are the focus of economic development and growth?

The economy should grow, not serve ppl who can’t manage their money -or anyone else’s.

[Starboard]

“Congress will continue to over-spend regardless of what interest rates are.”

************

Or regardless of what the national debt is.

The fact is this is how they buy votes and therefore the spending will keep rising. Its fundamentally how the system now works, despite the enormity of our debt servicing costs.

[reed13k]

Our debt will be gone with 4 simple things: 1) stop the fraud, 2) stop the international spending, American money for Americans first, 3) reduce the interest rate, 4) maintain the tariffs at a minimum of 10% across the board as a fee to access the largest spending market in the world.

[Starboard]

We are a consumer driven economy. Its a fact that consumer spending constitutes about 70% of the GDP. So what happens when the consumer is weighed down with debt and is running short of discretionary income to spend?

[DIRTYSECRET]

Let me take $100k out of my IRA tax free and do it for everyone else-not to jolt the economy-it doesn’t need it. Do it to push the buttons of the left. You know the tax cuts for the rich whine. A million dollar IRA after 40 years does not make one rich. In fact do it when the first Trump account gets rewarded.

[Miami Rebel]

Don’t blame Congress alone. President Trump has proposed ballooning the defense budget by half a trillion.

[Poison Pill]

Trump needs lower rates to save his Presidency. He’s going to get them, but he won’t like how.

[The Duke]

"As the jobs number indicate, we're in a fairly strong economy."

Is that number only the number/percent employed? What about numbers that indicate numbers of jobs with over a certain level of compensation?

I have trouble believing we have a strong economy when I read of 10's of thousands of layoffs, across the spectrum, every other day.

[jpl]

I support at least 90% of what President Trump does, but unfortunately almost every word that comes out of his mouth when it comes to our fiscal situation, the debt, and the deficit is complete and total B.S. He simply doesn’t care about the debt, at all. But in fairness, neither do the overwhelming majority of republicans and so-called conservatives.

[Miami Rebel]

The median US retirement account is just $200,000.

Carving out a tax break for upper-end savers (like me) has zero economic benefit. I’m not going to spend a nickel more than I already do, so it would provide, at least in my case, a reduction in tax revenue with no economic stimulus to offset it.

Setting policy just to “push the buttons of the left” is childish.

[Mariner]

The bond market disagrees with POTUS.

And the bond market holds the veto.

[Starboard]

I like your idea. Even a smaller amount would be a nice reward for building up assets for retirement. After all, isn’t this what the government wants us to do? At the same time it would inject some spending into the economy. Taxes should be relaxed on at least some portion of our retirement savings.

[TexasGator]

“I’ve been a financial professional for 45 years, but I cannot see what President Trump’s argument is. As the jobs number indicate, we’re in a fairly strong economy. Lowering short-term rates would exacerbate inflation and, counter-intuitively, pressure long-term rates higher, including, of course, mortgage rates.”

I am an Engineer and I understand.

[central_va]

Not true. Trump has the ability to think long term. The deficit is shrinking. Tariffs are making a HUGE difference. Also strong economic growth has also brought in huge revenues. So wake up.