Former President Donald Trump lashed out at Federal Reserve Chair Jerome Powell on Friday, criticizing him for not lowering interest rates to boost the economy after stock markets dropped following Trump’s new tariffs.
In a post on Truth Social, Trump wrote, “This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always ‘late,’ but he could now change his image, and quickly. Energy prices are down, Interest Rates are down, Inflation is down, even Eggs are down 69%, and Jobs are UP, all within two months – A BIG WIN for America. CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!”
Trump’s comments come as global stock markets have been falling sharply. The new tariffs Trump announced earlier this week have raised fears of a worldwide economic slowdown.
The Federal Reserve has held off on rate cuts recently, partly because inflation has not improved as much as expected. The new tariffs could cause prices to go up, at least temporarily, making inflation harder to control.
On Friday, Powell spoke to journalists in Arlington, Virginia, saying the Fed is “well positioned to wait for greater clarity” before making any decisions like cutting interest rates. He also noted that the new tariffs were “significantly larger than expected.”
Market interest rates have dropped this week, with the 10-year U.S. Treasury yield now under 4%. This often happens when investors worry about a potential recession.
The latest data from the FedWatch tool shows that traders now expect at least four rate cuts this year, compared to just two cuts predicted by the Fed last month.
Trump has downplayed the market’s reaction, at one point comparing it to a patient recovering from surgery.
When asked about Trump’s comments, Powell said, “I make it a practice not to respond to any elected officials comments, so I don’t want to be seen to be doing that. It’s just not appropriate for me.”
During his first term, Trump often criticized Powell and the Federal Reserve. This has led some to wonder if Trump will try to replace Powell before his term ends next year. However, Trump said in December he does not plan to fire Powell, and Powell has said the president cannot legally do so.
The Federal Reserve’s main goals are to keep prices stable and maximize employment. The March jobs report, released on Friday, showed a slight rise in unemployment to 4.2%, but the economy added 228,000 jobs, more than expected.
This jobs report doesn’t reflect any impact from the tariffs Trump announced earlier this week.
