Trump calls Fed chair a 'numbskull' as he pushes for interest rate cut
President Trump has been critical of the Federal Reserve chairman but said he wouldn't fire him over hesitation to lower interest rates
President Donald Trump cited new inflation data in continuing to pressure Federal Reserve Chair Jerome Powell to lower interest rates, calling him a "numbskull" but adding that he won't seek to remove him.
“We can’t get this guy to do it," Trump said of Powell lowering rates. "And the fake news is saying 'Oh if you fired him it would be so bad.' I don’t know why it would be so bad, but I’m not going to fire him.”
Trump described the latest inflation numbers as "incredible" during a June 12 event at the White House. Inflation ticked higher in May but was more stable than expected as the early effects of Trump’s wide-ranging tariffs were offset by another drop in gasoline prices.
Trump complained June 12 that "because of one numbskull" higher interest rates are costing the U.S. more money in debt payments. He has been pressuring Powell for months to cut rates.
Powell met with the president at the White House last month, where Trump continued to press his case and Powell said he won't take politics into account in setting monetary policy, according to a Fed statement and the White House press secretary.
The Fed left its key rate unchanged at the end of its May meeting and gave no hint it plans to lower it soon, citing "uncertainty." The central bank lowered the rate by a percentage point late last year as a pandemic-related price surge eased, but has paused cuts for three consecutive meetings.
The Fed next meets June 17 through June 18.
Trump repeatedly has attacked the Fed leader, but backed off suggestions that he could have Powell removed. Trump's attacks on Powell date back to shortly after Trump appointed Powell in 2017.
“I’m not happy with him… if I want him out, he’ll be out of there real fast, believe me," Trump told reporters during a White House event April 17.
The Federal Reserve Act of 1913 stipulates that Fed officials may be dismissed only "for cause," not for political or policy disagreements. Powell has said he believes his firing would not be permitted under the law.
The Fed system's seven governors, including the system chair, are appointed by the president and confirmed by the Senate. Powell's term ends in May 2026, and Trump is expected to nominate a successor in the coming months.
White House economic adviser Kevin Hassett said on April 18 that the president and his team were studying whether they could fire Powell. But Trump later said he has "no intention of firing" the Fed chair.
Powell warned in April about the impact of Trump's tariffs on inflation, telling the Economic Club of Chicago that "Unemployment is likely to go up as the economy slows, in all likelihood, and inflation is likely to go up as tariffs find their way and some part of those tariffs come to be paid by the public."
In general, the Fed cuts interest rates to stimulate a flagging economy and job market. It increases interest rates – or keeps them higher for longer – to lower inflation or prevent a spike in prices.
Contributing: Reuters, Paul Davidson