Trump mulling payroll tax cut to boost US economy

WASHINGTON

U.S. President Donald Trump said Tuesday he is considering a cut to payroll taxes as one of several options meant to stimulate the economy amid worries of a looming recession.

The payroll tax cut, Trump said, "is something that we think about" in addition to other possible cuts to taxes on stock sales. The White House just one day earlier denied a payroll tax cut was under consideration.

"A lot of people would like to see that, and that very much affects the workers of our country," he said.

But Trump said the biggest thing that could be done to boost the economy would be if the Federal Reserve cut interest rates by a minimum of 100 basis points and instituted quantitative easing, saying the impact would create "a burst of growth like you've never seen before".

"We actually are set for a tremendous surge of growth if the Fed would do its job," he said.

The Fed lowers interest rates to stimulate economic growth, as lower financing costs encourage borrowing and investing. Quantitative easing is a monetary policy where a central bank buys predetermined amounts of government bonds or other financial assets in order to inject liquidity directly into the economy.

Concerns have been mounting that the U.S. could be nearing recession amid a trade war with China that has no end in sight and a worrying economic indicator that arose last week which normally precedes a recession.

Trump continued to maintain that the economy is in 'great shape'.

“I think the word 'recession' is a word that’s inappropriate. It is just a word that certain people, I am going to be kind, certain people and the media are trying to build up because they would love to see a recession.

"We're very far from a recession," he said.