Note: This piece was originally featured in the February 2026 edition of MortgagePoint magazine.
From Roosevelt to Trump, commanders in chief have tried to bend the central bank to their will. Only one truly succeeded, and the consequences reshaped the American economy.
President Donald Trump is not the first president to pressure the Federal Reserve over interest rates, and he likely won’t be the last.
In fact, for more than 70 years, presidents have tried to use their influence to push the Fed to keep interest rates low.
Only Richard Nixon succeeded. He quietly pressured the Fed for low rates, which helped fuel a decade of inflation.
Other presidents, from Harry Truman to George H.W. Bush, saw their public pressure backfire or fail to take hold, according to the Washington Post.
Trump has pushed current Fed Chair Jerome Powell continuously during his second term to lower interest rates because he believes that low rates
produce faster growth, higher stock markets, cheaper borrowing, and a “winning” economy.
“We should be paying the LOWEST INTEREST RATE OF ANY COUNTRY IN THE WORLD … The Fed should substantially lower interest rates,NOW!” Trump recently wrote on Truth Social after one instance of the Fed voting to keep rates steady.
Trump argues that lower interest rates can juice gross domestic product in the short run and that a reduction would make mortgages, credit cards,
and business loans cheaper. Rates also tend to lift asset prices, especially stocks. Trump has said that, from his perspective, the Fed keeping rates “too high” is holding the economy back unnecessarily.
In what he called an “unprecedented action,” Powell said in January that the U.S. Justice Department served the Fed with grand jury subpoenas and threatened a criminal indictment related to his testimony before the U.S. Senate.
Powell said at the time he thought the DOJ action was not as much about his testimony, but more about a difference of opinion on interest rates. In a statement, he said the DOJ’s move should be seen in the broader context of the administration’s threats and ongoing pressure. Powell’s term as Chair ends in May, but he announced in early January that the Department of Justice has opened an investigation into him.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell said in a recorded video. “This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political
pressure or intimidation.”
While Trump may have more vociferously attacked Powell and the Fed than previous presidents, Trump is not alone in applying pressure.
In fact, presidents leaning on the Fed seemingly is an American tradition, even though the Fed is supposed to be independent.
