Powell Stands Firm on Rates Despite Trump Pressure
Powell holds rates steady amid Trump’s push for cuts, citing tariff risks and inflation concerns.
Summary
Fed Chair Jerome Powell reaffirmed the central bank’s cautious stance on rate cuts in testimony before Congress, resisting growing political pressure from Donald Trump and GOP leaders to act swiftly. Powell emphasized economic resilience but warned of inflationary risks from tariffs.
Key Takeaways
- Trump’s Public Push: Trump called Powell “a real dummy” and demanded immediate 2–3% rate cuts to reduce debt costs.
- Fed Split Emerges: Two Fed governors back July cuts, but most officials favor waiting.
- Tariff Uncertainty: Powell says new tariffs could raise inflation, adding complexity to timing cuts.
Why It Matters
The tension highlights a critical test of the Fed’s independence amid political turbulence and economic crosswinds. With inflation still above target and borrowing costs biting consumers, the path forward remains murky — and politically charged.
Source Link
Fed Chair Powell Holds Firm On ‘Wait-And-See’ Approach To Rate Cuts
Federal Reserve Chair Jerome Powell told Congress the central bank can afford to wait and see how President Donald Trump’s tariffs affect the economy before deciding whether or not to cut borrowing costs, despite Trump’s increasingly intense demands for cuts.
Full Bio
Jerome Powell tells Congress the Fed will “wait and see” before cutting rates, despite mounting pressure from Trump and GOP leaders.
