#PowellVsTrump Former President Donald #Trump has intensified his criticism of Federal Reserve Chair Jerome #Powell following the Federal Reserve’s decision to keep interest rates steady between 4.25% and 4.50% for the fourth consecutive session. Trump, who initially nominated Powell in 2017, launched a late night diatribe on Truth Social, labelling him “stupid” and a “dummy,” accusing him of inflicting billions in damage on the American economy by withholding rate cuts.

The Core of Trump’s Argument

Trump insists that the Federal Reserve should enact a full 2 percentage point cut, contrasting this with Europe’s recent run of rate reductions. He referred derisively to Powell as “a political guy who’s not a smart person,” arguing the slow approach is equivalent to “monetary malpractice” (foxbusiness.com). He even speculated whether he might appoint himself to run the Fed once Powell’s term concludes in May 2026.

Powell and the Fed Stand Firm

Jerome Powell and the Federal Open Market Committee have remained resolute, emphasising that interest rate decisions are data‑led, not politically influenced. Officials have noted persisting inflation risks such as Trump’s newly introduced tariffs and rising oil prices making them reluctant to introduce premature cuts.

Despite expecting potential rate reductions later this year (the so‑called “dot plot” suggests two cuts by year‑end), policymakers have cautioned against haste. They consider it prudent to await clarity on the impact of tariffs and global tensions before acting.

Political Fallout and Institutional Concerns

Trump’s continued verbal assaults calling Powell “the WORST” and openly casting doubt on the Fed’s independence have stirred concerns among economists and investors. They warn that.

political pressure on the Fed could unsettle markets just when stability is most needed.

Meanwhile, advocates like FHFA Director Bill Pulte have also chimed in, demanding Powell’s resignation in sympathy with Trump’s calls for immediate rate reductions, particularly to relieve housing pressures.

Implications for Markets and Consumers

Economists highlight that any abrupt policy shift could reverberate through mortgages, retirement portfolios, and broader financial markets. At present, market expectations anticipate a quarter point rate cut in September, though some Fed officials caution that even this timeline is uncertain.

Conclusion: A Fed Torn Between Politics and Prudence

The Federal Reserve finds itself in a delicate position caught between political pressure from Trump to reduce rates and the need to uphold macroeconomic stability. While Trump and his allies paint Powell’s approach as costly and lazy, the Fed argues that its cautious stance is justified given the risks of inflation and the lack of comprehensive data on trade policy effects.

As of June 2025, this makes for a tense climate: Trump continues to vocally question Powell’s competence, even floating the idea of replacing him. Yet #PowellRemarks Powell and the Fed are holding their ground, trusting in their mandate to make decisions guided by numbers, not politics.