Trump urges interest rate cuts despite ongoing inflation

• Trump Calls for Rate Cuts
• Powell Rejects Immediate Changes
• Inflation Rose in January

U.S. President Donald Trump shook up the economic landscape this Wednesday by calling for interest rate cuts, while simultaneously pushing his policy of broad tariff increases, all just before the release of inflation data showing a rise in January.

«Interest rates should be lowered, which will go hand in hand with tariff hikes,» he wrote on his Truth Social account, adding his emphatic «Let’s rock and roll, America!»—a statement that surprised both economists and his supporters.

Minutes later, after reports confirmed a 3% inflation rate in January, Trump posted again: «Biden’s inflation is going up!» blaming the price surge on the Democratic administration of Joe Biden.

The president’s demands directly target the Federal Reserve, which is responsible for U.S. monetary policy. However, its chairman, Jerome Powell, recently made it clear that he does not foresee an imminent rate cut.

Powell Warns About the Risks of Premature Rate Cuts Advocated by Trump

«There is no need to rush in adjusting our policy,» Powell stated before the Senate Banking Committee, fulfilling his semiannual report on monetary policy.

The Federal Reserve chairman argued that cutting rates «too quickly or too much could hinder progress on inflation.»

Meanwhile, an adjustment that is «too slow or too little could unduly weaken economic activity and employment.»

Despite these warnings, Trump continues his persistent calls for a «rate cut» to stimulate the economy and national industry. However, the inflationary impact of this measure, coupled with higher tariffs, could further increase price pressures.

The White House and the Federal Reserve appear headed for a direct confrontation, as Powell has repeatedly reaffirmed the central bank’s independence from executive demands.

Trump’s statements on inflation have been frequent since the issue became a central point in public debate—particularly when, as a Republican candidate, he blamed «Biden’s inflation» for the rising cost of living.

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Lowering interest rates, raising tariffs, and blaming the White House for price index declines are shaping up to be the next chapter in the ongoing clash between Trump and Powell, with the U.S. economy as the backdrop.

According to analysts, Trump’s pressure to ease monetary policy while tightening trade regulations could influence inflation trends in the coming months, creating a complex scenario for economic growth and job stability in the U.S.

Meanwhile, tensions at the top of the economic leadership show no signs of easing, as the president’s trade strategy is accompanied by efforts to control internal costs without harming the competitiveness of American businesses.

Investors and experts agree that political uncertainty could further exacerbate inflation in the United States, while also warning that a potential recession continues to loom over the world’s leading economic power.

SOURCE: EFE

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