At the signing ceremony of the law on Thursday, President Donald Trump continued to criticize the Chairman of the Federal Reserve (Fed), Jerome Powell, arguing that the failure to cut interest rates has cost the government up to $600 billion a year in short-term debt payments.
Despite stating he would not fire Powell, Trump still called him a 'fool' for not acting sooner.
“No more inflation. Prices are down. Cut the interest rates,” Trump emphasized.
Meanwhile, the U.S. Department of Labor reported that inflation in May rose by 2.4%, slightly lower than the forecast of 2.5%.
Fed Keeps Interest Rates Steady, Despite Political Pressure
The Federal Open Market Committee (FOMC) in May decided to keep the operating interest rate at 4.25% – 4.5%, arguing that this is the appropriate level to achieve full employment and control inflation.
Interest rates have not changed since last December, when the Fed made a slight cut of 0.25%.
After a series of attacks, Powell met Trump at the White House, but according to the Fed, he did not share any policy forecasts, only affirming that all decisions would be based on objective, non-political data and analysis.
Trump Labels 'Slow Action Powell', Persistent Criticism
Not stopping there, Trump continued to mock Powell:
“The Bank of England has cut, China has also cut, everyone is cutting, only he refuses to do anything. I call him 'Too Late Powell' – Powell acts too late.”
Nevertheless, Trump appeared confident: “Even if Powell doesn’t cut rates, the U.S. economy is still very strong.”
However, his remarks continue to raise concerns about political interference in monetary policy – a principle that the Fed always strives to protect.