Donald Trump has launched a blistering attack on the head of the Federal Reserve and said that his ‘termination’ as the US central bank chairman ‘cannot come fast enough’.
In an extraordinary outburst on social media, the US president lambasted Jerome Powell over his reluctance to cut interest rates in the world’s largest economy, derisively nicknaming him ‘Too Late’.
The comments came as the European Central Bank (ECB) cut rates in the eurozone for the seventh time in a year – to 2.25 per cent – to prop up a struggling economy facing a battering from Trump’s tariffs.
The Bank of England is expected to follow suit next month with a fourth interest rate cut in the UK since August.
The Fed cut rates in the US from between 5.25 per cent and 5.5 per cent to a range of 4.25 per cent to 4.5 per cent last year but has resisted further reductions this year despite pressure from Trump.
In Chicago on Wednesday evening, Powell warned the trade war unleashed by the president will result in ‘higher inflation and slower growth’ in the US.
Criticism: US President Donald Trump (left) lambasted Federal Reserve chief Jerome Powell (right) over his reluctance to cut interest rates in the world’s largest economy
But he added that the central bank should ‘wait for greater clarity’ before cutting rates again.
Powell also said the Fed’s ‘independence is very widely understood and supported in Washington and in Congress where it really matters’.
It provoked a furious response from Trump, who took to social media yesterday and said that Powell
was ‘always too late and wrong’ and branded the speech ‘another, and typical, complete mess’.
‘“Too Late” should have lowered interest rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough.’
Powell was appointed Fed chairman in 2018 during Trump’s first stint as president and is due to remain in the job until May 2026, having been reappointed under Joe Biden in 2022.
It is not clear whether Trump is resigned to Powell seeing out his term or intends to remove him in what would be a major assault on the Fed’s independence.
Chuck Schumer, the Senate’s Democratic leader condemned Trump’s
comments, saying yesterday: ‘An independent Fed is vital for a healthy economy – something that Trump has proved is not a priority for him.’
The ECB rate cut came as it warned: ‘The outlook for growth has deteriorated owing to rising trade tensions.
‘Increased uncertainty is likely to reduce confidence among households and firms, and the adverse and volatile market response to the trade tensions is likely to have a tightening impact on financing conditions.’
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