After the Fed kept the interest rate, President Donald Trump continued to mock President Jerome Powell and said that the United States had almost no inflation.
“Jerome Powell ‘is slow’ is a fool, not knowing anything. Besides that, I am very gentleman,” the US President wrote on social network Truth Social on 8/5. He also affirmed that the price of oil and energy is plummeting, almost every cost (both food and eggs) go down.
“The United States is almost no inflation. Taxes are also flowing here,” the US President said.
Earlier, after a two-day policy meeting, the US Federal Reserve (Fed) on May 7 announced that the reference interest rate kept at 4.25-4.50%. This level has been maintained since the end of last year.
This decision made Mr. Trump unhappy. Over the past few months, he repeatedly called for Fed to lower interest rates. Analysts say that President Trump wants to reduce interest to minimize the impact of import tax. However, Fed President Jerome Powell did not want to do this early, due to concerns.
President Donald Trump at the White House on April 22. Image: AFP
In the announcement on May 7, the Fed said the agency has not changed the interest rate until the economic prospects become more clear. They also warned that “unemployment risks and inflation are increasing”.
At the press conference later, the Fed President also mentioned Mr. Trump’s recent criticism. He affirmed this “absolutely does not affect the work of the Fed”. “We always use policy tools to promote employment and stabilize prices, for the benefit of Americans. We only consider economic, prospects and risks,” Powell said.
Last month, White House Economic Adviser Kevin Hassett said the Trump administration considered legal regulations to find ways to dismiss Powell. This makes the market worried that the Fed no longer has the ability to operate independently. The US stock market, the US dollar and the price of US government bonds simultaneously plummeted. On April 22, the situation of cooling down when Trump confirmed that there was no intention of firing Powell.
In the interview with NBC Last weekend, Mr. Trump also reaffirmed that he would not dismiss Powell. “No, what do I do? I will be replaced for him for a short time,” Trump said. Powell’s chairman will end in May 2026.