Emre Yumlu 
Trump: This is a perfect time for Fed Chair Powell to cut interest rates. Powell is always late in cutting rates.
President Donald Trump: “Cut Interest Rates Jerome, Stop Playing Politics!”
President Donald Trump has called on Fed Chairman Jerome Powell to cut interest rates in response to recent economic developments. In a post on Truth Social, Trump stated that now is a “perfect time” for Powell to make the change, noting that the Fed Chairman has often been “late” in his decisions, but this time he could improve his image by acting quickly.
Trump highlighted the drop in energy prices, interest rates, and even egg prices, alongside a significant increase in employment, saying, “Cut interest rates Jerome, stop playing politics!“
This statement comes as Trump’s new tariff policies have led to a sharp market sell-off, raising concerns about a global economic slowdown and a possible inflation rebound. These new trade policies could also create temporary inflationary pressures, complicating the Fed’s decision on interest rate cuts.
Powell: “It’s the Right Time to Step Back and Wait for Clarity”
In his remarks in Arlington, Fed Chairman Powell emphasized the need to wait for greater clarity before making any changes to the central bank’s policy. He also stated that the newly announced tariffs were “significantly larger than expected.”
Market expectations are different. With 10-year U.S. Treasury yields falling below 4%, CME’s FedWatch tool indicates that traders now expect the Fed to cut rates four times this year, whereas the Fed had previously projected only two cuts.
Trump’s ongoing interference with the central bank’s policy has led to tensions with Powell in the past. However, Trump has indicated that he does not intend to remove Powell from his position at this time, and Powell has argued that such a move would not be legally possible.
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