Donald Trump Calls Jerome Powell a ‘Fool’ as Fed Keeps Rates Steady

President Donald Trump has criticized Federal Reserve Chairman Jerome Powell following the decision to maintain current interest rates. The Federal Open Market Committee (FOMC) concluded its two-day meeting on May 7 by announcing that benchmark interest rates would remain steady at the 4.25% to 4.5% range, in line with market expectations. The president took to social media to express his frustration with Powell’s monetary policy stance.

Trump Calls Jerome Powell a Fool, Here’s Why

The president reacted to Jerome Powell after the Fed decided to leave interest rates unchanged. Trump, on his Truth Social, called Powell “Too Late” Jerome Powell and “a FOOL, who doesn’t have a clue.”

Despite the disparaging comment, Trump added a sarcastic qualifier: “Other than that, I like him very much!” This comment is part of Trump’s pattern of publicly denouncing officials while claiming personal fondness.

Trump highlighted his belief that current economic conditions require rate reductions rather than the status quo. In his tweet, he listed some of the economic indicators that he believes necessitate reduced rates: “Oil and energy way down, almost all costs (groceries and ‘eggs’) down, virtually NO INFLATION, Tariff Money Pouring Into the U.S.”

The president concluded his message by stating that the economic circumstances at present are “the exact opposite of too late.” Trump’s comments are an extension of his long history of publicly shaming the Federal Reserve on monetary policy.

Fed Keeps Interest Rates Unchanged

After its two-day Federal Open Market Committee (FOMC) meeting on May 6-7, the FED kept its benchmark interest rate in the range of 4.25 to 4.5%. This action was in keeping with what the market expected since the traders were convinced that Jerome Powell and the committee would not raise rates at this May meeting.

In its official declaration, the Fed announced that it would maintain the existing target federal funds rate range. The Fed had also maintained interest rates in their January and March meetings of the year 2025.

This trend of stable rates follows a period when money policies were relaxed late in 2024. At that time, the central bank reduced the rates three times in September, November, and December. Those reductions marked the beginning of an easing cycle after a prolonged period of elevated rates aimed at combating inflation.

Despite calls from President Trump to lower rates based on his assessment that inflation is now under control, the Fed has opted to maintain its cautious approach. Powell had also cited Trump’s tariffs as a reason for inflation.

Peter Schiff Slams Trump

Criticising Trump’s stance, economist Peter Schiff shared an X post. He pointed out the inconsistency in Trump’s stance, noting that if the US economy is indeed on the verge of its greatest boom, as Trump claims, then it would be foolish to lower interest rates. Schiff is targeting Trump’s alleged contradictory views- boasting about economic growth while advocating for lower interest rates.