President Donald Trump criticized Fed Chair Jerome Powell on Truth Social, calling for lower interest rates to address concerns about a slowing U.S. economy but risking inflation. Trump accused Powell of being late in adjusting rates and claimed he lowered them to help his political opponents. Hassett suggested studying options for removing Powell, sparking concern over political interference with the Fed. This move is unprecedented and could lead to inflation as the central bank prioritizes economic growth over price stability. Market reactions were negative with the S&P 500 and Dow Jones Industrial Average falling. Bond yields decreased as investors sought safer assets. Trump may be acknowledging the negative impact of his tariffs strategy on the economy with a potential recession looming. While inflation has slowed from pandemic highs, it remains above the Fed’s target and actually accelerated in February. Treasury Secretary Bessent indicated the administration would begin interviewing candidates for Powell’s successor in the fall, giving a six-month lead time before Powell’s term ends next year. Not all White House officials support pressuring Powell, highlighting potential division within the administration.
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Trump criticizes Jerome Powell for being too slow in cutting interest rates, calling him a ‘loser’
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