Trump Suggests Political Motives Behind Powell's Fed Decisions, Points To Threat Of 'Massive Inflation Again'

Former President Donald Trump on Friday shared his thoughts the nation's economic direction and critiqued Federal Reserve Chairman Jerome Powell's leadership.

In an interview with Maria Bartiromo, Trump expressed his apprehensions about Powell, suggesting a political inclination in his decision-making, especially regarding interest rate policies.

"I think he's political," Trump said, adding that he believes that Powell's actions might favor the Democratic Party.

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Highlighting the potential for inflation due to escalating tensions in the Middle East impacting oil prices, Trump doubted Powell's capability to manage such economic challenges. "But you have the potential of having massive inflation again, because the Middle East could drive up the price of energy," Trump said, according to Fox Business.

Despite originally appointing Powell in 2018, Trump indicated a change in leadership for the Federal Reserve should he assume the presidency again, stating, "No, I wouldn't do that," when asked about reappointing Powell. 

The Fed's strategy has led to a significant tightening of monetary policy, with rates increasing from nearly zero to over 5% in a relatively short period. This has resulted in higher borrowing costs for both consumers and businesses, impacting the broader economy.

Trump also attributed the recent bullish trends in the stock market to his political prospects, suggesting that investor optimism about his potential return to office is driving market gains, Fox Business reported. "They think I'm going to be elected," Trump added, linking market performance to his political fortunes.

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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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