President Trump threatened on Friday to halt a broad swath of U.S. trade unless the Federal Reserve slashed interest rates, issuing a sweeping ultimatum that could prove costly to the economy if he were to carry it out. The Fed is a politically independent institution, and it has long kept rates steady as it tries to tame years of persistent inflation. Mr. Trump's demand risked undermining that work, while choking off commerce in ways that could harm American families and businesses.

The president delivered his threat on a day that began on a positive note for the White House. Hiring figures showed that employers added about 162,000 jobs in August, evincing a labor market that has weathered a range of shocks under Mr. Trump. On social media, Mr. Trump heralded that development before seizing on it to issue his demands, calling on the Fed to reduce borrowing costs to "the LOWEST RATE of any country in the World." The Fed has kept rates steady since last December, and policymakers have signaled they are considering whether to raise rates as soon as this month.

Mr. Trump insisted the U.S. economy was "STRONG" and could afford lower borrowing costs, though economists warn such a move could worsen inflation. Absent a cut, Mr. Trump signaled he could interrupt global trade with countries where the U.S. has a deficit, including Canada, Mexico, the European Union, and China. The U.S. trade deficit in goods and services rose to its biggest gap in 16 months in July.

Mr. Trump's remarks were his latest attempt to pressure the Fed, even after securing the confirmation of his handpicked chairman, Kevin M. Warsh. The Fed's decision later this month hinges in part on inflation data coming out next Friday. Investors ratcheted up bets about a possible increase after Mr. Warsh signaled he was open to the idea, while Governor Christopher J. Waller said a "hot" inflation report would compel him to support a rate increase.