Trump Tells Powell He's 'Making A Mistake' By Not Cutting Rates, Fed Reaffirms Independence

President Donald Trump summoned Federal Reserve Chair Jerome Powell to the White House on Thursday for their first face-to-face meeting since taking office in January.

Trump informed the central bank chief that he was making a “mistake” by not lowering interest rates.

What Happened: The meeting renewed a contentious relationship between Trump and Powell, with both sides confirming the president initiated the discussion.

“The President did say that he believes the Fed chair is making a mistake by not lowering interest rates, which is putting us at an economic disadvantage to China and other countries,” White House spokeswoman Karoline Leavitt said.

Powell maintained the Fed’s independence, stating that monetary policy “will depend entirely on incoming economic information,” according to the Federal Reserve’s official statement. He emphasized decisions would be based on “careful, objective, and non-political analysis” to support maximum employment and stable prices.

The Federal Reserve Board (FRB) kept rates steady at 4.25%-4.50% for the third consecutive meeting, with officials warning that “uncertainty about the economic outlook has increased further,”. Fed officials have signaled rates may stay unchanged for months while assessing tariff policy impacts.

See Also: Germany Considers 10% Digital Tax On Tech Giants Alphabet, Meta: Report

Why It Matters: Financial markets currently price in rate cuts beginning in September, with a second reduction expected in December. Federal Housing Finance Agency Director William Pulte recently urged Powell to “lower interest rates — enough is enough,” posting on social media that “the housing market would be in much better shape,”.

Real estate investor Grant Cardone has accused Powell of being “antagonistic to Trump Administration,” claiming in a May 7 social media post that Powell “either lacks confidence to act or worse he’s attempting to block Trump’s pro business theme.”

Trump elevated Powell during his first term but frequently criticized his rate decisions. Their last face-to-face meeting occurred in November 2019 with then-Treasury Secretary Steven Mnuchin present.

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

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