WASHINGTON (Gray DC) – The White House did not back down on its pressure campaign on Federal Reserve Chairman Jerome Powell to lower interest rates Tuesday.
The continued pressure comes one day after President Trump sent the markets into a tailspin with a social media post that called Fed Chairman Jerome Powell a “major loser.” The post also claimed the economy could slow down unless interest rates fall immediately.
White House Press Secretary Karoline Leavitt at the White House Briefing responded to our question on the historical respect Presidents have for the independence of the central bank.
“Look, I think the president has made his position on the fed and on, Powell quite clear,” Leavitt said. “The president believes that they have been making moves and taking action in the name of politics, rather in the name of what’s right for the American economy.”
She also defended Trump’s right to criticize Powell, despite his criticisms hurting the stock market.
“The president has the right to express his displeasure with the fed, and he has the right to say he believes interest rates should be lower,” Leavitt said.. “And he has called into question the Fed’s independence and whether they are actually doing things again, out of the best interest of the economy or are they doing it for partisan reasons.”
Meanwhile the dollar has plunged sharply over the last few weeks – hitting a 3-year low today versus the Euro.
“The president wants to see the dollar remain as the world’s reserve currency, for our long term fiscal stability and our economic growth,” Leavitt said. “He’s been quite clear about that.”
President Trump nominated Jerome Powell as Fed Chair in his first term. Powell’s term doesn’t expire for another year.
Because Powell has said the President’s tariffs will likely lead to slower growth and higher inflation, the President is now contemplating firing Powell. Such a move would likely lead to a showdown at the Supreme Court.
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