Trump Pressures Fed to Cut Interest Rates Amid Tariff Strategy

US President Donald Trump has once again urged the Federal Reserve to lower interest rates, arguing that such a move would help counterbalance the economic impact of his tariff policies.

His latest call for action came on Wednesday night via Truth Social, just hours after the Fed decided to keep rates unchanged while lowering its growth forecast and raising its inflation outlook.

Trump’s demand—“Do the right thing”—underscored his ongoing dispute with the central bank’s decision-making. While the Fed has projected two rate cuts this year, Chairman Jerome Powell cautioned that economic uncertainty remains “unusually elevated” and acknowledged a recent uptick in inflation.

Many economists have warned that Trump’s tariffs, which have been met with retaliatory measures from other nations, could increase the risk of a global economic downturn. However, Trump remains optimistic, acknowledging that the economy may experience “a little disturbance” but insisting that the US is on the brink of a “golden age.”

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In his Wednesday night post, Trump reiterated that April 2 would mark a significant turning point as he plans to implement “reciprocal tariffs” aimed at resetting global trade. He views this move as a necessary step to level the playing field for American businesses but insists that lower interest rates are also essential for maintaining economic momentum.

“The Fed would be MUCH better off CUTTING RATES as US tariffs start to transition (ease!) their way into the economy,” he wrote.

Throughout his presidency, Trump has frequently criticized the Federal Reserve’s monetary policy, arguing that higher interest rates have hindered economic growth. He has repeatedly pushed for rate cuts as a means of stimulating the economy, particularly in times of trade uncertainty.

As the debate over tariffs and interest rates continues, investors and policymakers alike will be closely watching the Fed’s next moves—and the potential economic ripple effects of Trump’s trade policies.

AFP