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President Trump and Federal Reserve Chairman Jerome Powell talked past each other this morning, with the president demanding interest rate cuts in the wake of a vibrant economy while the central bank leader warned the economy was in danger of fraying following the new round of Trump tariffs.

Trump took to his Truth Social site with a direct message to Powell that stated: This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always “late,” but he could now change his image, and quickly. Energy prices are down, Interest Rates are down, Inflation is down, even Eggs are down 69%, and Jobs are UP, all within two months – A BIG WIN for America. CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!”

For his part, Powell used a speech before a business journalists conference to declare the economy could experience higher prices and weaker growth because the new round of Trump tariffs was greater than anticipated.

“While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent,” Powell said. “While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent. Avoiding that outcome would depend on keeping longer-term inflation expectations well anchored, on the size of the effects, and on how long it takes for them to pass through fully to prices. Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem.”

Powell made no commitment to potential rate cuts, which will be decided when the central bank’s policy making Federal Open Market Committee conducts its next meeting from May 6-7.

“It is too soon to say what will be the appropriate path for monetary policy,” Powell said.

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