President Trump said the next Federal Reserve chair should consult with him on interest rate policy, calling presidential input a past norm as the central bank debates further cuts.
By yourNEWS Media Newsroom
President Donald Trump said in an interview that the next chair of the Federal Reserve should consult with him on interest rate decisions, arguing that such coordination was common in earlier eras and should be revived.
“Typically, that’s not done anymore. It used to be done routinely. It should be done,” Trump said. “It doesn’t mean I don’t think he should do exactly what we say. But certainly I’m a smart voice and should be listened to.”
Trump said he is leaning toward either National Economic Council Director Kevin Hassett or former Federal Reserve governor Kevin Warsh to replace Chair Jerome Powell, whose term expires in May. Powell was originally nominated by Trump during his first term but has since faced repeated criticism from the president over the pace and direction of interest rate policy.
The president reiterated his preference for substantially lower borrowing costs, saying he would like to see interest rates at 1 percent or lower by this time next year. “We should have the lowest rate in the world,” Trump said.
The remarks came shortly after the Federal Reserve approved a quarter-point rate cut earlier this week following a narrow and divided vote, reflecting disagreement among policymakers over how quickly to ease monetary policy.
Inflation remains above the Fed’s stated 2 percent target, and several officials cited uncertainty in inflation trends and employment data as reasons for caution. Kansas City Fed President and Chief Executive Jeffrey Schmid said he opposed the rate cut, arguing inflation was “too hot” and that monetary policy should remain “modestly restrictive” to address ongoing price pressures.
Trump has consistently argued for more aggressive rate reductions, saying lower rates would ease borrowing costs for consumers, businesses, and the federal government. He has renewed public criticism of Powell in recent months, even as the central bank has moved forward with multiple rate cuts this year.
Federal Reserve officials, including Powell, have repeatedly defended the institution’s independence, emphasizing that interest rate decisions are guided by economic data rather than political considerations. Powell has said the Fed’s mandate is centered on price stability and maximum employment, and that its ability to operate “free of political interference” is essential to serving the broader economy.
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