President Donald Trump played down fears on Tuesday (Aug 20) that the United States was heading towards recession while confirming that his administration was considering a payroll tax cut.
Trump says his administration is looking at a cut in the capital gains tax when investors sell assets.
The Washington Post has reported the administration is considering a temporary payroll tax cut to boost the USA economy, which has recently shown signs of slowing down in the near future. A strong economy is seen as key to his re-election prospects in 2020, but trade tensions with China are stoking concerns about an imminent slowdown. But many economists think the impact of those cuts is starting to wane. "We're looking for a rate cut, we could be really greatly helped if the Fed would do its job and do a substantial rate cut".
"They have to do a rate cut", he said, insisting that at a minimum the Federal Reserve should do nothing.
"We're shooting all the arrows before we even need to start shooting", said Steven Rosenthal, a senior fellow at the nonpartisan Tax Policy Center. In private, they're increasingly worrying about a global economic slowdown triggering a USA recession - and weighing options to shore up the economy ahead of an election year.