Trump tells Federal Reserve Chairman that he is making a mistake by not cutting interest rates

President Trump told Federal Reserve Chair Jerome Powell that he is making a mistake by not lowering interest rates. The face-to-face encounter follows months of Powell criticism from Trump and pressure on the Fed to ease monetary policy.

The Fed said in a statement that Powell met with the president to discuss “economic developments including for growth, employment, and inflation.” Powell, according to the Fed, “did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook.”

The chair said he and his colleagues on the Fed’s rate-setting committee will make decisions about monetary policy “based solely on careful, objective, and non-political analysis,” the Fed added in its statement.

The White House confirmed the Powell meeting, with press secretary Karoline Leavitt telling reporters that the Fed’s summary was correct but noting that the President pushed Powell to lower rates.

“The president did say that he believes the Fed chair is making a mistake by not lowering interest rates, which is putting us at an economic disadvantage to China and other countries,” she said, adding Trump has been very vocal about his views publicly as well.

As during his first term in office, Trump has been a vocal critic of Powell, repeatedly encouraging the Fed chair to cut interest rates. Powell has urged caution and patience on rates, saying he expects Trump’s tariffs to push inflation higher and drag down growth — putting the Fed in a challenging spot.

Earlier this month the central bank elected to keep its benchmark interest rate unchanged in a range of 4.25%-4.50%. Following that meeting, Trump on social media called the central bank boss a “fool” who “doesn’t have a clue.”

The president added during an Oval Office press conference on May 8 that he didn’t plan to meet with Powell, saying, “It’s like talking to a wall.” Despite harsh barbs from Trump that have included calling Powell a “major loser,” the president has been clear that despite, in his view, having the authority to fire Powell, Trump has no plans to remove Powell from office.

Mr Trump believes that cutting rates would give the economy a considerable boost, but his priorities are different from those of the Federal Reserve. As of now, it looks like the Federal Reserve’s vision will win out, and Mr Trump will be able to point to their refusal to cut interest rates as a reason for slower growth.