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Bank of America Corp. Chief Executive Officer Brian Moynihan said the U.S. has no need for negative interest rates because its economy is strong, unlike other regions that have employed the tricky strategy.
“We should feel good that the U.S. has positive rates,” Moynihan said Thursday at an event hosted by the Washington Post. “Our economy is growing at 2%-plus and other economies in the world are not, and that's why they need negative rates.”
While central banks around the world are reducing interest rates in response to slowing economic growth, some nations in Europe have pushed them below zero for several years. Other countries “have very difficult growth problems” so they have turned to negative rates which aren't even “a proven strategy,” Moynihan said.
His view contrasts with that of U.S. President Donald Trump, who has repeatedly called for the Fed to deploy negative rates. Earlier this month, he said policy makers are hurting the U.S. by not copying other central banks.
“Give me some of that money. I want some of that money. Our Federal Reserve doesn't let us do it,” Trump told the Economic Club of New York, drawing laughs from the audience. “It puts us at a competitive disadvantage to other countries.”
Read more: Trump slams Fed, says shunning negative rates hurts U.S.
To contact the reporter on this story: Lananh Nguyen in New York at lnguyen35@bloomberg.net
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Dan Reichl, Josh Friedman
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