Trump Urges Fed to Slash Interest Rates: Why He Believes Powell Should Be Replaced ASAP

President Donald Trump recently reiterated his call for the Federal Reserve to lower interest rates and suggested that Chairman Jerome Powell should be replaced. In a post on Truth Social, he criticized Powell, stating, "The ECB is expected to cut interest rates for the 7th time, and yet, ‘Too Late’ Jerome Powell…issued a report which was another, and typical, complete ‘mess!’"

Trump pointed out that oil prices and grocery costs are down, claiming that the U.S. is prospering from tariffs. He feels Powell should have lowered rates sooner, just like the European Central Bank (ECB) is doing, and remarked that Powell’s removal "cannot come fast enough."

The ECB has indeed been cutting rates to stimulate growth in Europe. Analysts anticipate another rate cut soon, as the region seeks to revive its economy amid various challenges.

Powell addressed these issues in a recent speech at the Economic Club of Chicago, where he acknowledged the complications tariffs add to the Fed’s goals of managing inflation and fostering growth. His comments led to a significant stock market decline, reflecting growing concerns among investors.

This isn’t the first time Trump has criticized Powell. He previously urged for rate cuts, suggesting it would be a "PERFECT time" for the Fed chairman to act decisively. However, this is a notable moment, as it marks the first time Trump has directly suggested Powell’s firing. While Trump expresses frustration, Powell maintains that the president does not have the authority to dismiss him, emphasizing that the law protects the independence of the Federal Reserve. Powell’s tenure as chairman lasts until May 2026.

Experts highlight that central banks around the world face similar dilemmas. In a recent survey by Bloomberg, about 65% of economists believe that rate cuts will be a critical tool for managing economic downturns in the coming year. This insight implies that Trump’s call for actions like those of the ECB resonates with many who closely watch economic policies globally.

As discussions around monetary policy continue, public sentiment on platforms like Twitter reflects a mix of opinions. Some users express support for Trump’s perspective, while others highlight the need for a more cautious approach to avoid negative long-term effects on the economy. The ongoing debate showcases the complexity of balancing growth with inflation management, a challenge faced by policymakers worldwide.

For more information on the Federal Reserve’s role and its impact on the economy, you can visit the Federal Reserve’s official site.

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