Trump says Fed Chairman Powell will cut interest rates this year to help Democrats

Trump says Fed Chairman Powell will cut interest rates this year to help Democrats

Federal Reserve Chairman Jerome Powell, and former President Donald Trump.
Anna Moneymaker/Getty Images

  • Trump accused Federal Reserve Chairman Powell of making politically motivated decisions on interest rates.
  • He said Powell is considering lowering interest rates this year to help Democrats.
  • Powell stressed that he has no role in policy making and will continue to evaluate economic data.

The head of the country’s central bank does not get former President Donald Trump’s stamp of approval.

In a Friday morning interview with Fox News, Trump criticized Federal Reserve Chairman Jerome Powell’s handling of the economy, especially regarding interest rates. While Powell previously stressed that his position had nothing to do with policy making, Trump accused the bank president of being a “politician” and making decisions that would help Democrats in the upcoming elections.

“I think he would do something to maybe help the Democrats, I think, if he lowered interest rates,” Trump said, adding, “It seems to me like he’s trying to lower interest rates in order to get people elected.” “

He also said that if he wins re-election, he will not reappoint Powell to head the Fed.

Trump’s comments come after the Federal Open Market Committee decided on Wednesday to continue the pause on interest rate hikes in its first step for 2024. While the committee’s December summary of economic forecasts indicated three rate cuts for this year, Powell said on Wednesday that it was unlikely that These cuts will be made at the next meeting in March.

“I don’t think it’s likely that the committee will reach a level of confidence by the March meeting to identify March as the time to do it, but that’s what we’ll see,” Powell said.

Powell has repeatedly stressed that economic data will drive the committee’s interest rate decisions throughout the year, and said it is important to move cautiously so as not to risk doing too little too soon. Friday’s jobs data will support the decision to postpone interest rate cuts until after March – with the US economy beating expectations by adding 353,000 jobs. A hot labor market will likely mean the Fed will hold off on cuts for a little longer.

However, some Democratic lawmakers are urging Powell to consider lowering interest rates sooner rather than later to give Americans financial relief. Before Wednesday’s decision, Senators Elizabeth Warren, John Hickenlooper, Jacky Rosen, and Sheldon Whitehouse sent a letter to Powell saying that “interest rates remain too high for many American families who cannot already afford rent or buy their first home.” Role.”

“As the Fed considers its next steps in the new year, we urge you to consider the impacts of interest rate decisions on the housing market and reverse the alarming interest rate increases that have put affordable housing out of reach for many.” books.

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