President Donald Trump on Thursday lashed out at Federal Reserve Chair Jerome Powell, criticising him for once again refusing to cut interest rates. He wrote on Truth Social, “Jerome “Too Late” Powell has done it again!!! He is TOO LATE, and actually, TOO ANGRY, TOO STUPID, & TOO POLITICAL, to have the job of Fed Chair.”
Trump further added, “He is costing our Country TRILLIONS OF DOLLARS, in addition to one of the most incompetent, or corrupt, renovations of a building(s) in the history of construction! Put another way, “Too Late” is a TOTAL LOSER, and our Country is paying the price!.”
Fed reserve holds interest rates steady
The Federal Reserve held short-term interest rates steady at 4.25 to 4.5 percent. The decision marked the first double dissent from Fed board members in over three decades, as Vice Chair of Supervision Michelle Bowman and Governor Christopher Waller, both considered potential contenders for Trump’s nomination to replace Powell when his term ends in May, voted in favour of a rate cut. During the press conference, Powell made it clear that Fed is focused on controlling inflation – not on government borrowing or home mortgage costs. He added that the risk of rising price pressures from the administration’s trade and other policies remains too high for the central bank to begin loosening its “modestly restrictive” grip on the economy until more information is collected.
Why does Trump want to reduce rates?
Donald Trump has been urging for interest rate cuts to lower borrowing costs, boost economic growth, and reduce the government’s interest payments on national debt. He argues that slashing rates, by as much as three percentage points would improve the performance of key sectors like housing and ease financial pressure on both consumers and businesses. However, the Federal Reserve, under Chair Jerome Powell, has resisted Trump’s push for aggressive rate cuts, pointing to ongoing concerns about inflation. The Fed remains focused on price stability, viewing inflation as a more immediate risk than employment. With inflation still above the Fed’s 2% target, the central bank has opted to keep rates in a restrictive range of 4.25% to 4.5%.
‘No decision about September’
Federal Reserve Chair Jerome Powell said at the news conference, “We have made no decisions about September. We don’t do that in advance. We’ll be taking that information into consideration and all the other information we get as we make our decision.” He further explained that the central bank is monitoring the potential impact of tariffs on inflation: “Our obligation is to keep longer-term inflation expectations well anchored and to prevent a one time increase in the price level from becoming an ongoing inflation problem.”