Washington — Former President Donald Trump has intensified his criticism of Jerome Powell, the Chair of the Federal Reserve (Fed), accusing him of hindering U.S. economic growth by not lowering interest rates. Trump took to his social media platform, Truth Social, to suggest replacing Powell with someone he believes would act more swiftly. \n\nTrump argues that Powell has been too slow to respond to current economic conditions. He has publicly called for an immediate one-percentage-point cut in interest rates, a move considered unusual by the central bank’s standards. \n\nThe Fed, under Powell, has maintained the benchmark interest rate between 4.25% and 4.50% since December. In May, the institution decided to keep it unchanged, citing the need for greater economic clarity, especially amid potential trade scenarios influenced by Trump’s decisions. \n\nCentral banks typically make gradual adjustments, usually in quarter-point increments. Trump’s proposal deviates from this norm. While the president can nominate the Fed Chair, he cannot directly remove them due to policy disagreements. Powell was appointed by Trump in 2017, but their relationship has soured over differing views on interest rate management. \n\nLowering interest rates could facilitate credit, boost consumer spending, and support short-term economic growth. However, it also raises the risk of inflation, which the Fed monitors closely. Trump downplayed this risk, suggesting that the Fed could always raise rates again if inflation occurs. \n\nMonetary authorities have opted to keep rates steady for now, basing their decision on a careful analysis of economic indicators and the potential effects of a more relaxed monetary policy on prices and financial stability. Trump has labeled the decision not to cut rates as a “mistake.” \n\n— new from El Imparcial
