Trump again calls for Fed to cut rates, says Powell’s ‘termination cannot come fast enough’

Trump reiterates his attack on the Federal Reserve, demands immediate rate cuts, and demands Powell's ouster. On April 17, 2025, amid growing economic and political tensions, former President Donald Trump has rekindled his attacks on the Federal Reserve and its chairman, Jerome Powell, in a familiar return to a long-standing feud. Trump, who is currently the most likely Republican candidate for president in 2024, reiterated his call for an immediate decrease in interest rates and slammed Powell's leadership, stating that "his termination cannot come fast enough." The new criticism was voiced at a campaign rally in Ohio and later appeared in posts on Trump's Truth Social social media platform. Trump accused the Fed of "suffocating the economy" with what he labeled as “reckless and unnecessary” interest rate hikes that, in his view, are slowing economic growth and burdening American families.

A Longstanding Clash

Trump has previously taken aim at Powell and the Federal Reserve. During his presidency, Trump frequently criticized the central bank for not cutting rates aggressively enough to boost the economy. He appointed Powell as Fed Chair in 2017, but their relationship quickly soured as Powell prioritized fighting inflation and maintaining the Fed’s independence over aligning with Trump’s economic strategies.

Trump has maintained an active role in shaping public discourse regarding the economy, frequently utilizing the Fed as a political target, even though he has retired from day-to-day governance. As he seeks to define economic policy ahead of a possible second term, his most recent remarks reflect a renewed campaign of pressure. Calls for Rate Cuts

In his latest comments, Trump argued that interest rates are “crippling” the housing market, small businesses, and middle-class families. “The Fed is asleep at the wheel,” he said. “While hardworking Americans are struggling to buy homes and grow their businesses, Jerome Powell is off playing economic games that benefit no one but Wall Street.”

Trump demanded an “immediate and substantial” rate cut, suggesting that slashing the federal funds rate could help spur economic growth, reduce borrowing costs, and “bring America back to prosperity.” However, critics argue that such a move could reignite inflationary pressures and undermine the Fed’s credibility.

Federal Reserve’s Current Stance

The Federal Reserve has remained committed to a cautious monetary policy under Powell's leadership, particularly after the inflation surge of 2021–2022. In recent months, inflation has shown signs of cooling, but the Fed has resisted calls for aggressive rate cuts, citing the need to ensure price stability over the long term.

At its most recent meeting, the Federal Open Market Committee (FOMC) opted to keep interest rates steady, signaling that while rate reductions may be considered later in the year, the central bank remains data-dependent and wary of premature loosening.

Powell, who rarely responds directly to political criticism, has repeatedly emphasized the importance of the Fed’s independence and its dual mandate to maintain price stability and full employment.

Political Implications

Trump’s renewed attacks on Powell come at a strategic time. With the 2024 election approaching, the economy is poised to be a central issue. By targeting the Fed, Trump appears to be laying the groundwork for an economic narrative that positions him as a pro-growth candidate while framing Powell and the Fed as out-of-touch bureaucrats stifling American prosperity.

Trump's remarks, according to some political analysts, may also have been intended to mobilize his base and divert attention from other issues. By reviving a familiar adversary in Powell, Trump returns to a theme that played well with his supporters during his first term: challenging the Washington establishment.

However, not all Republicans are aligned with Trump’s view. Several conservative economists and lawmakers have defended the Fed’s recent actions, arguing that maintaining inflation control is critical to long-term economic stability.

Reactions from Wall Street and Economists

After Trump's most recent statements, the markets reacted cautiously. The majority of investors continue to focus on incoming economic data and official Fed guidance rather than political rhetoric, despite the fact that speculation of potential Fed policy shifts caused short-term Treasury yields to slightly fall. Economists remain divided. Some agree with Trump’s call for rate reductions, especially if inflation remains under control and growth slows. Others warn that political pressure on the Fed could backfire, potentially damaging its independence and undermining its ability to manage the economy effectively.

Senior Brookings Institution economist Sarah Klein stated, "Calls for Powell's removal or public interference in the Fed's decisions are not only counterproductive but also dangerous." “Central banks must operate independently to maintain market trust and long-term economic health.”

What Happens Next

Powell’s current term as Fed Chair runs through 2026, and only the sitting President can formally remove or replace him. The White House has largely avoided commenting on the Fed's policies, and President Joe Biden has given no indication that he intends to fire Powell. Nevertheless, Trump’s comments are likely to resonate throughout the political and financial spheres, especially if economic conditions shift in the coming months. Whether the Fed heeds the growing chorus for rate cuts remains to be seen, but one thing is certain: the central bank—and Powell in particular—will remain a flashpoint in the 2024 election narrative.

As Trump continues to make the economy a centerpiece of his campaign, the tension between political agendas and monetary policy is likely to intensify, setting up a contentious debate over how best to steer America’s economic future.