WASHINGTON (TNND) — President Donald Trump is once again putting public pressure on Federal Reserve Chair Jerome Powell, calling for interest rate cuts amid signs of a cooling labor market. But while rate cuts have been projected for months, the Fed hasn’t moved since December of 2024, and Powell doesn’t seem ready to cave just yet.

So, what’s the holdup? And how does this standoff compare to past administrations?

The Last Time the Fed Cut Rates

According to Forbes, the last rate cut came on December 18, 2024, during the final weeks of the Biden administration. The Fed lowered rates by 25 basis points, moving from 4.50–4.75% to 4.25–4.50%.

That December move marked the third rate cut in three months and was a response to a clear shift in the data. Inflation had cooled significantly from its pandemic-era peak, and the labor market was starting to ease. Unemployment was inching up, and consumer spending had begun to soften. In other words, the Fed had the economic cover it needed to pivot.

Since then, though, no additional cuts have materialized, despite early 2025 projections hinting at at least one by summer.

Why the Fed Is Holding Back

The core issue? Inflation still hasn’t hit the Fed’s 2% target. According to the most recent Consumer Price Index report, annual inflation rose to 2.7% in June, up from 2.4% in May. That’s not the direction Powell wants to see.

According to economists at EY, the Fed is now expected to deliver two cuts in 2025, one in September and another in December, assuming inflation continues to decline and the labor market shows more definitive signs of cooling. But the widely expected summer cut? That’s pretty much off the table.

Trade policy uncertainty isn’t helping either. With tariffs and global tensions in flux, the Fed is proceeding cautiously.

A Look Back: Rate Cuts in Past Administrations

The current back-and-forth between Trump and Powell isn’t the first time politics and monetary policy have collided, but it’s important to note: rate cuts don’t happen because presidents want them. They happen because the economy demands them.

Here’s how it’s played out under past administrations:

Trump’s first term: The Fed cut rates three times in 2019 during the U.S.–China trade war, then made emergency cuts in March 2020 as COVID-19 hit. Rates were slashed to near zero.Biden’s term: The Fed responded to soaring post-pandemic inflation with aggressive rate hikes throughout 2022 and 2023, before reversing course with three cuts in late 2024.Obama’s presidency: Following the 2008 financial crisis, the Fed cut rates to zero and kept them there for years. The first rate hike didn’t come until late 2015.

As Bankrate’s chief financial analyst Greg McBride put it:

“The Fed has been sitting back, evaluating economic data amidst all the uncertainty. The old saying that you skate to where the puck is going to be — if you don’t know where the puck is going to be, you can’t skate to it.”

Bottom Line

Right now, inflation is still hovering just above target, and the data is mixed. That’s why Powell is keeping rates steady, despite public calls for action from the White House.

Unless the economy takes a sharper downturn, don’t expect rate cuts to come easily or early.