President Carter, back out on the campaign circuit, yesterday repeated his criticism of the Federal Reserve Board and singled out several major banks for raising interest rates "more than economic circumstances warrant."
His remarks, delivered in answer to questions at a "town meeting" in Nashville, Tenn., came only a week after Carter stunned onlookers in both parties -- and drew criticism later himself -- for lambasting the Fed's policies.
The president also conceded yesterday that his greatest mistake as chief executive was that he did not do enough to combat inflation during his first two years in office but rather concentrated instead on creating more jobs.
Carter said that, had he known that oil prices were going to surge so rapidly in 1979, "I would have put more emphasis on controlling inflation than I did" during the early years of his administration.
"I wish I had done it differently," he said.
Apparently convinced the pocketbook issue needs more attention, Carter plans to deliver two speeches on the economy in the next five days -- a 20-minute radio broadcast on Sunday and a "major" address in Washington on Tuesday.
In his Nashville appearance yesterday, Carter specifically singled out Citibank of New York for its recent increase in interest rates, saying its prime rate now was higher than economic conditions justified.
Citibank boosted its prime -- the interest it charges its most creditworthy corporate customers -- to 14 percent last Thursday, up from 13 percent before and a half percentage point above the rest of the industry.
No other major banks since have followed Citibank's lead, but at the same time, none of them has reduced its rates, despite a suggestion to that effect last week by Fed Chairman Paul A. Volcker.
Carter's renewed criticism of the Fed came as a surprise to some observers. The president drew heavy fire after his last statement, both from Republicans and middle-of-the-road economists.
His earlier remark was taken by some as disingenuous, in part because the Fed actually has been allowing the money supply to grow rapidly and Carter has appointed five of the seven Fed governors, including Volcker.
Carter told his audience yesterday that "in retrospect" the inflation threat is obvious but asserted that "when I took office we had a very high umemployment rate and the inflation rate was fairly low."
The jobless rate Carter faced in January 1977 was 7.4 percent of the work force -- a 10th of a percentage point below where it is now -- while consumer prices rose 4.8 percent in 1976, compared with around 13 percent for the year that ended in August.