Powell’s Recommendation To Trump
Washington, D.C. — Federal Reserve Chairman Jerome Powell is once again under fire after signaling that interest rate cuts won’t come any time soon—despite strong calls from President Donald Trump and top Republican lawmakers urging immediate action to boost the U.S. economy.
Testifying before the House Financial Services Committee on Tuesday, Powell doubled down on his wait-and-see approach. “We are well-positioned to hold steady and monitor economic data before considering any rate adjustments,” he said.
Trump: Lower Rates Could Save America $800 Billion
President Trump has not held back. In a post on Truth Social, he blasted Powell for refusing to cut rates while other nations have moved quickly.
“‘Too Late’ Jerome Powell is testifying today to explain why America still hasn’t seen a single rate cut. Europe has had 10. We’ve had zero,” Trump wrote. “We should be 2 to 3 points lower—that alone would save the USA $800 billion a year.”
Trump emphasized that the economy is strong, inflation is under control, and the only thing standing in the way of further growth is the Federal Reserve’s inaction.
Fed Remains Divided While Americans Struggle With High Borrowing Costs
Powell admitted that Fed officials are split. While a majority favor interest rate cuts later this year, a vocal minority wants to keep rates elevated. The Fed’s internal projections show some expect rates between 3.5% and 4%, while others want them held between 4% and 4.5%.
So far, the official forecast suggests two standard rate cuts (0.25% each) by the end of 2025.
Inflation Falls Under Trump, But Fed Still Cautious
Contrary to media alarmism, inflation has been trending down. The Consumer Price Index (CPI) rose just 2.4% in May—slightly higher than April’s 2.3% but well below the 3% seen earlier this year.
That drop comes despite the impact of Trump’s strategic tariff policies, which have not fueled inflation as critics feared.
Powell acknowledged inflation could tick upward slightly this summer but gave no clear commitment to adjusting rates soon.
Republicans Demand Action to Support Seniors, Homeowners, and Small Business
Several GOP lawmakers echoed Trump’s frustration. Rep. Bill Huizenga (R-MI) questioned why other countries are cutting rates while Americans—especially retirees and homebuyers—face high interest on everything from mortgages to credit cards.
House Financial Services Chairman French Hill pointed to remarks from Fed Governor Christopher Waller, who said rate cuts could be justified if tariffs remain in place. With Trump keeping pressure on China, that condition is being met.
Tariffs Working: Import Prices Fall, Especially on Apparel
Despite predictions of skyrocketing costs, import prices—especially for clothing—are down. Former Fed economist Claudia Sahm noted a nearly 3% drop in apparel prices, suggesting foreign producers are absorbing the costs, not U.S. consumers.
Powell conceded the impact of tariffs varies, but added: “Ultimately, the tariff will be paid—it’s just a question of who bears the cost.”
Bottom Line: Americans Want Relief—But Powell Isn’t Delivering
With the Trump economy growing stronger and inflation easing, many Americans—especially older voters, retirees, and small business owners—are wondering why the Fed continues to hold back.
Cutting interest rates now could deliver savings, investment growth, and economic momentum when Americans need it most.
