President Donald Trump demanded a significant 2.5-point interest rate cut on Thursday, continuing his unprecedented and focused rhetorical assaults on Federal Reserve Chair Jerome Powell.
Powell was appointed in 2017, but Trump has often criticised the Fed chair for maintaining rates higher than the president wants. Following a monetary policymaking meeting on Wednesday, the Fed said that it will keep interest rates between 4.25% to 4.5%. The Fed noted that while the economy is still doing well, the direction of inflation is unclear, in part due to the massive tariffs that Trump has imposed on foreign goods.
It would be extraordinary to drop two and a half points right away. The scale of each rate change is in line with the current state of the economy, although the Fed typically modifies its benchmark lending rate by a quarter point. For instance, the Fed hiked by up to three-quarters of a point in 2022, when inflation was at 40-year highs.
Powell has stated that he is focused on the Fed’s responsibility to maintain low inflation and good job creation, declining to address Trump’s jabs. When questioned about Trump’s expressed intention to name a new Fed head when his term ends next year, Powell said that he is solely focused on the present.
Also Read:
On Friday, Gold Prices Reached a Nearly Two-Month High
Amid Regional Tensions, the Indian Embassy in Israel Issues a Safety Alert
