President Donald Trump on Tuesday responded to the most recent inflation report by calling on the Federal Reserve to lower interest rates.
“No Inflation, and Prices of Gasoline, Energy, Groceries, and practically everything else, are DOWN!!! THE FED must lower the RATE, like Europe and China have done,” Trump said on Truth Social.
On Tuesday, the Department of Labor said the consumer price index—the government’s primary measure of inflation—rose by just 0.2 percent in April after declining one-tenth of a point in March. Compared with a year ago, consumer prices are up just 2.3 percent, the lowest annual inflation since just after Trump left office in February 2021. Both measures were lower than economists had forecast.
“What is wrong with Too Late Powell? Not fair to America, which is ready to blossom? Just let it all happen, it will be a beautiful thing!,” Trump wrote.
President Trump has been severely critical of Fed chairman Jerome Powell and the Fed’s policy of holding interest rates steady while it seeks more clarity on the direction of inflation, economic growth, and the labor market. The Fed cut interest rates at three consecutive meetings last year, beginning with a large half-point reduction just weeks ahead of the 2024 election, but has not moved the policy rate since Trump took office. Trump has said he will not try to remove Powell before his term as chairman expires next year.
The CPI report showed that tariffs have not ignited inflation. While some categories rose in price, many categories declined, including groceries and energy. The overall picture is one of mild inflation close to the Fed’s two percent target.
President Trump tapped Powell, a lifelong Republican and former investment banker who was nominated to the Fed’s Board of Governors by President Barack Obama, to head the Fed in his first term as president. When the Fed then hiked rates several times early in Trump’s presidency, Trump publicly criticized the moves and Powell’s judgment. Powell was reappointed to the top post by President Joe Biden.
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