Federal Reserve expected to hike interest rates Wednesday

President Trump on Monday urged the Federal Reserve not to raise interest rates. But Fed officials are widely expected to do so this week despite the president’s public effort to dissuade the U.S. central bank from putting any brakes on the economy.

“It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning and China way down, the Fed is even considering yet another interest rate hike. Take the Victory!” Trump wrote Monday in a Twitter post.

Fed officials will conclude a two-day policy meeting on Wednesday, and Wall Street traders predict nearly an 80 percent chance that the Fed will raise rates a quarter point this week, setting them at a range of 2.25 percent to 2.5 percent. That hike would keep rates low by historical standards but put them at the highest level in a decade.

The president’s repeated exhortations against the Fed raising rates break with his predecessors, who generally avoided commenting publicly on the central bank’s policies to protect its credibility and independence.

Interest rate increases are meant to check inflation, but they can also slow the economy, adding another challenge to Trump’s efforts to deliver on his promises of booming growth. A slowing economy — or a recession — could damage Trump’s reelection efforts in 2020.

While the U.S. economy looks strong right now, there are signs of a potential slowdown. The Dow Jones industrial average is on track to end 2018 in the red, potentially notching the worst performance in a decade and erasing one of the president’s top talking points: that the market has thrived in his tenure.

The housing market has also been weak. Business investment, which bounced earlier this year, dried up in the third quarter. Growth is widely expected to slow next year as the effects of the Republican tax cuts and extra government spending diminish.