Even before he was sworn is for his second term as U.S. President, Donald Trump persistently pushed the Federal Reserve to lower interest rates.
He made that same demand on Thursday, pressing Federal Reserve Chair Jerome Powell to cut interest rates immediately, rather than wait for the next policy meeting on March 17.
In a Truth Social post, Trump questioned where Powell was and used a mocking nickname for Powell.
“Where is the Federal Reserve Chairman, Jerome “Too Late” Powell, today? He should be dropping Interest Rates, IMMEDIATELY, not waiting for the next meeting,” Trump wrote in his post.
Trump’s comments come ahead of the Federal Open Market Committee’s meeting on Tuesday, when the Fed’s 12-member rate-setting panel will decide whether to change its key interest rate, Fox Business reported.
That Fed’s benchmark rate helps determine what consumers and businesses pay to borrow money — including for mortgages, car loans, and credit cards.
The meeting on Tuesday comes as the conflict with Iran has fueled a run-up in energy prices, adding to inflation pressures the Fed is watching closely, as well as complicating Trump’s pledge to lower costs for Americans, Fox reported.
The president’s remarks came hours after the Bureau of Labor Statistics reported that the consumer price index increased 2.4% in the 12 months ending in February. That rate has held relatively steady but is slightly above the central bank’s 2% inflation target. The CPI is one of the key measures the Fed considers when making interest rate decisions, alongside employment data.
Higher inflation or a weakening job market can influence whether the Fed’s board raises or lowers rates.
Oil prices surged past $100 a barrel for the first time since 2022 as fallout from the U.S.-Israeli conflict with Iran continued to unsettle global markets and investors priced in the risk of tighter supply.
Rate Changes Usually Occur at Meetings
Fox noted that the president’s demand for a rate cut runs up against how the Fed typically operates.
Typically, rate changes are made at scheduled meetings. The Fed has cut rates between meetings during crises, Fox noted, most recently in 2020 during the COVID-19 pandemic.
Trump nominated Powell to lead the Fed in 2017, and the President has intensified his public campaign in recent months, calling for rates to fall as low as 1% as part of his push to stimulate growth.
Powell at first held off on rate cuts as the Fed assessed the economic impact of Trump’s evolving trade agenda. That posture kept the Fed’s benchmark rate at 4.25% to 4.5% for a period, Fox noted. The Fed has since lowered rates, and the target range now stands at 3.50% to 3.75%. But even after rate cuts, Fox noted that Trump has escalated his attacks on Powell and the central bank.
The president’s renewed demands also sharpen the long-running tension between the administration and an institution designed to operate independently. Fed officials have said that rate decisions will be driven by economic data, not political pressure.
Fox noted that tension now has grown beyond monetary policy.
Department of Justice prosecutors opened a criminal investigation in January tied to Powell’s prior testimony to Congress about cost overruns on the Fed’s headquarters renovation project.
Powell, in a public response to the investigation, called the probe “unprecedented” and described it as another salvo in what he described as Trump’s pressure campaign on the central bank to cut rates.
Powell’s term as chair ends May 15.
Trump has nominated former Fed governor Kevin Warsh to succeed him, putting the Fed’s next moves and Powell’s final months under even brighter scrutiny, Fox reported.
