The Federal Reserve does not cut interest rates, Trump lashes out
Cornell University professor Eswar Prasad stated that if U.S. inflation remains above target levels and Trump continues to pressure for interest rate cuts, the Federal Reserve will face a "very challenging" situation in the coming months. However, Powell refused to respond to Trump's calls for rate cuts, emphasizing that there is no connection between the Federal Reserve and the White House
The Federal Reserve keeps interest rates unchanged, Trump criticizes the central bank's decision.
On Wednesday, January 29, the Federal Reserve announced that it would maintain the current interest rates in the United States, keeping them between 4.25% and 4.5%. This decision sparked strong criticism from Trump, who accused the Federal Reserve of failing to effectively control inflation.
Trump criticized on the social media platform Truth Social:
“If the Federal Reserve spent less time on diversity, equity and inclusion, gender ideology, ‘green’ energy, and false climate change, inflation wouldn’t be a problem.”
Yesterday, Federal Reserve Chairman Jerome Powell stated that the Federal Reserve believes the U.S. inflation rate is still “slightly rising,” and therefore, U.S. interest rate policymakers “do not need to rush to adjust the policy stance.” Powell also removed the previous mention of “progress” toward the 2% target.
Cornell University professor Eswar Prasad stated that if U.S. inflation remains above target levels and Trump continues to pressure for rate cuts, the Federal Reserve will face a “very challenging” situation in the coming months.
However, Powell declined to respond to Trump’s calls for rate cuts, emphasizing that there is no connection between the Federal Reserve and the White House.