Federal Reserve chair Jerome Powell shares the Federal Reserve’s semi-annual monetary policy report.
President Donald Trump on Tuesday called out the Federal Reserve, saying the central bank should lower interest rates.
“Interest Rates should be lowered, something which would go hand in hand with upcoming Tariffs!!!” Trump said in a post on Truth Social. “Lets Rock and Roll, America!!!”
The president’s comments come a day after Fed Chairman Jerome Powell said on Capitol Hill that the central bank doesn’t need to “hurry” to lower interest rates.
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“We do not need to be in a hurry to adjust our policy stance,” Powell testified before the Senate Banking Committee on Tuesday. “We know that reducing policy restraint too fast or too much could hinder progress on inflation. At the same time, reducing policy restraint too slowly or too little could unduly weaken economic activity and employment.”
Federal Reserve Chairman Jerome Powell testified before the Senate Banking Committee on Feb. 11, saying that the central bank does “not need to be in a hurry to adjust our policy stance.” (Mandel Ngan/AFP via / Getty Images)
Fed officials, at their most recent meeting in January, held the benchmark federal funds rate steady at a range of 4.25% to 4.5%.
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It follows three consecutive interest rate cuts at the central bank’s most recent meetings – including a 50-basis-point cut in September as well as a pair of 25-basis-point reductions in November and December.
The FOMC’s January statement said that the Fed continues to pursue its dual mandate of achieving maximum employment and inflation at 2% over the longer run. It added that the “economic outlook is uncertain, and the Committee is attentive to risks to both sides of its dual mandate.”
Trump’s Wednesday post is not the first time the president has commented on interest rates this year. He said during a speech to the World Economic Forum in January that he plans to bring down the price of oil and, in turn, energy prices to address inflation – which he said should serve as the impetus for the Fed to cut rates.
“With oil prices going down, I’ll demand that interest rates drop immediately. And, likewise, they should be dropping all over the world. Interest rates should follow us,” Trump said.
Speaking before the World Economic Forum in Davos, Switzerland, Trump said he’ll call for interest rates to be lower than current levels. A possible sign he is setting up a possible battle with the Federal Reserve.
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At a press conference following the Fed’s January rate decision, Powell was asked by a reporter if he had a response to Trump’s comments to the World Economic Forum. The reporter asked the Fed chair if Trump relayed that demand to him, as well as if he had a response or what the effect of such comments by the president are.
“I’m not going to have any response or comment whatsoever on what the president said. It’s not appropriate for me to do so,” Powell said at the time.
