Trump repeats call for Fed rate cut, attacks Powell over $3 billion building renovation
'Jerome 'Too Late' Powell must NOW lower the rate,' Trump wrote on Truth Social.
Trump added that the US economy was performing strongly despite what he called Powell's missteps. 'Fortunately, the economy is sooo good that we've blown through Powell and the complacent Board,' he said.
The president said he was considering 'allowing a major lawsuit against Powell to proceed because of the horrible, and grossly incompetent, job he has done in managing the construction of the Fed Buildings.'
Trump claimed the project cost $3 billion, compared with what he said should have been a $50 million refurbishment. 'Not good!' he wrote.
NBC News reports that the Fed declined to comment on Trump's post. Powell and the Fed have previously defended the ongoing renovations, saying costs have increased over time for specific reasons.
Last month, during Trump's visit to the construction site, Powell responded directly to the president's claim that the work had cost more than $3.1 billion. 'I haven't heard that from anybody,' Powell said, according to NBC News.
Trump has been publicly pressuring the Fed for months to sharply reduce interest rates, claiming this would save the US large sums and ease debt burdens.
After raising rates in 2022 following the Covid-19 pandemic, the Fed cut them several times in 2024, the last full year of Joe Biden's presidency. Rates have remained unchanged so far in 2025 despite Trump's calls for faster reductions. Powell told Congress in July that the Fed might have eased policy this year if not for Trump's tariff measures.
According to NBC News, Fed officials had earlier signalled they expected two rate cuts in total this year. Traders now see a quarter-point cut after the Federal Open Market Committee's September meeting, with growing expectations for further cuts in October and December.
Trump, who has repeatedly criticised Powell over monetary policy and other issues, has made lowering the Fed's benchmark rate a key demand.
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The Hindu
19 minutes ago
- The Hindu
Opposition parties, some DMK allies condemn overnight arrest of conservancy workers
Opposition parties and some allies of the ruling DMK on Thursday criticised the overnight detention of protesting conservancy workers of the Greater Chennai Corporation (GCC). In a post on X, AIADMK general secretary and Leader of the Opposition Edappadi K. Palaniswami, addressing Chief Minister M.K. Stalin, said: 'At the entrance of Ripon Building, in the dead of night, your administration unleashed oppression, attacking and crushing the sanitation workers who, even during COVID-19, tirelessly cleaned our garbage and kept the city spotless. They were forcibly removed and imprisoned in various places by your enforcement machinery.' 'Who are they? Anti-social elements? Thugs? Naxalites? Not at all. They are poor, simple people! Those who worked daily to keep Chennai city clean. Is it a crime that these sanitation workers protested peacefully, condemning your failure to fulfil the promises you made and acting contrary to them,' he asked. 'The sanitation workers have been imprisoned in more than eight locations. I urge that they be released immediately and that those injured due to these reckless actions be provided proper medical treatment,' Mr. Palaniswami said. In a post on X, Mr. Selvaperunthagai, president of Tamil Nadu Congress Committee (TNCC), said even though there is a Madras High Court direction that the conservancy workers can protest only at authorised places, the police should have handled the situation with compassion. He also sought Mr. Stalin's direct intervention in resolving the issue and ensuring the release of the detained workers and those who supported them. Condemning the arrest, BJP Tamil Nadu president Nainar Nagendran said Chief Minister M.K. Stalin did not have the heart to meet the protesting workers, but had time to extend wishes to a film crew, and it is shameful. 'Is oppressing the poor people and taking away their democratic rights the social justice preached by DMK?' he asked. Communist Party of India (Marxist) State secretary P. Shanmugam condemned the arrest, urged for their release and called for action against the police. PMK president Anbumani Ramadoss also took a jibe at Mr. Stalin for watching a movie. 'Unleashing force on poor people is not courage, it is cowardice. Fulfilling their demands is courage. It is certain that the day people remove the DMK from power is not far away,' Dr. Anbumani said. Tamilaga Vettri Kazhagam (TVK) chief Vijay also condemned the arrest. 'The sanitation workers have been protesting only to demand the fulfilment of the promises you made when you were in the Opposition. Why have you still not fulfilled those promises? If you cannot keep such promises, why do you make them in the first place,' he said. He also sought the immediate release of the detained sanitation workers and said they must be given an alternative space to continue their protest and present their demands. Former Tamil Nadu Chief Minister O. Panneerselvam, Tamil Maanila Congress (Moopanar) leader G.K. Vasan, AMMK founder T.T.V. Dhinakaran, DMDK general secretary Premallatha Vijayakanth, Naam Tamilar Katchi leader S. Seeman, Viduthalai Chiruthaigal Katchi (VCK) deputy general secretary Vanni Arasu, Manithaneya Makkal Katchi (MMK) president Prof. M.H. Jawahirullah also condemned the arrest. MDMK chief Vaiko urged the state government to quickly implement the welfare schemes announced for the workers, requesting the workers to accept them and return to work. Kongunadu Makkal Desiya Katchi (KMDK) general secretary and Tiruchengode MLA E.R. Eswaran also requested workers to return to work. Speaking to reporters in Chennai, Viduthalai Chiruthaigal Katchi (VCK) president and Chidambaram MP Thol. Thirumavalavan expressed concern over the arrest of protesting conservancy workers. He welcomed the announcements by the Chief Minister, but said the party does not support privatisation. Chief Minister should reconsider the privatisation decision and called for release of those arrested and should regularise their jobs, Mr. Thirumavalavan said. Meanwhile, the Chennai Press Club condemned the police action, seizing a drone and other equipment from newspersons from Theekkathir newspaper's digital division when they were reporting the news of the protest and detention. In a post on X, the Club urged the police to immediately return the seized equipment and the video files.
Economic Times
19 minutes ago
- Economic Times
Trump is aiming for Pakistan-style compliance from India, but his plan is not working
Synopsis Amidst rising tensions, the US-India trade relationship faces turbulence as Trump's administration imposes tariffs, allegedly to pressure India on geopolitical issues like Russian oil imports. India views these actions as an infringement on its sovereignty, resisting demands to compromise on agriculture, patent laws and military sourcing. India's refusal to play a compliant role, unlike Pakistan, frustrates Trump. "Trump wants a vessel like Pakistan. India refuses to behave like one." That blunt assessment from Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), captures the essence of the US-India trade saga: it's less about economics than geopolitics. While headlines focus on tariffs and trade deficits, the underlying story is about power, leverage and sovereignty. Speaking to Economic Times, Srivastava explains, "Washington expects compliance, and India is not yielding." Trump, who is set to meet Russian leader Vladimir Putin on Friday at Joint Base Elmendorf-Richardson in Alaska, has long framed tariffs as a tool to 'fix trade deficits,' but India's case suggests a different motive. On August 7, the US announced it would raise tariffs on Indian goods from 25% to 50%, citing Delhi's purchase of Russian oil. India called the move 'unfair' and 'unjustified,' with the new rate set to take effect on August 27. The White House framed the tariffs as a way to cut Russia's energy revenues and pressure Vladimir Putin toward a ceasefire. With this increase, India becomes the most heavily taxed US trading partner in Asia, joining Brazil which faces similar steep tariffs amid tense bilateral relations. The economic stakes for India are high. In 2024, India exported $87 billion worth of goods to the US. According to US Census Bureau data for May 2025, imports from India stood at $9.43 billion, while US exports to India were $3.82 billion, resulting in a US goods trade deficit, or an Indian surplus, of roughly $5.6 billion. If the 50% tariffs remain in place, nearly all of India's annual exports to the US could become commercially unviable. Meanwhile, the US continues to run a $45.7 billion goods trade deficit with India, yet these tariffs disproportionately affect Indian exports compared with goods from other Srivastava, the message is clear: 'Trade deficit is just for the namesake. It's about forcing countries to fall in line with a geopolitical agenda.' India imports roughly 20% of its GDP in goods, spanning petroleum, machinery and electronics, yet Washington appears less concerned with trade imbalances than with pressuring India to compromise on and dairy have emerged as key sticking points in India-US trade talks, which collapsed earlier this month. On August 7, Prime Minister Narendra Modi declared, 'India will never compromise on the well-being of its farmers, dairy producers and fishermen.' New Delhi has consistently resisted US pressure to open these sectors, arguing that doing so would threaten millions of small farmers. Historically, India has kept agriculture largely off the table in trade agreements to safeguard domestic to Srivastava, US demands extend far beyond tariffs: opening government procurement, diluting patent laws that could make medicines costlier, limiting future digital taxes, and shifting military sourcing to the US. 'Even if we open agri and dairy, no trade deal will happen with this. Not a trade issue. They want you to open your government procurement, dilute patent laws, commit to never charge digital tax in future, buy military from the US, the list is endless,' he adds, 'Trump imposed 50% tariffs on Brazil partly over politics and partly because Brazil asked Twitter to remove anti-Brazil content. Records show India generates even more such requests, so he could use that as an excuse too. He can conjure unlimited reasons to impose tariffs if he's unhappy. My sense is he doesn't want a partner in India, he wants a vassal. India refuses to play that role; it insists on an equal partnership. That's the basic problem.'The US approach to Russian oil imports is uneven. China, Russia's largest crude buyer, faces no comparable tariff threats, while India is under heavy pressure. 'Even if the US demanded zero imports from Russia, India's imports would fall anyway due to economic circumstances,' notes Srivastava. European and US bans on petroleum products derived from Russian crude are already reducing India's imports, independent of Washington's selective approach reflects a broader pattern in US trade policy. Brazil, for example, faced a 50% tariff despite running a surplus with the US, largely over political disagreements including its stance on Venezuela and former President Bolsonaro. Venezuela itself is under secondary sanctions for buyers of its oil, though some firms, like Chevron, have received exemptions. These cases suggest that political alignment often outweighs economic between Russia and the US has dropped roughly 90% since the Kremlin's full-scale invasion of Ukraine, though last year the US still imported $3 billion worth of Russian goods, according to the US Bureau of Economic Analysis and Census Bureau. Meanwhile, the European Union, a partner in sanctions against Russia, imported $41.9 billion (36 billion euros) of Russian goods in 2024, Eurostat data the US pressures India to cut Russian oil imports, market forces and global regulations are already reshaping trade flows. Europe and US bans on petroleum products ensure India's imports will decline regardless of Washington's actions. Srivastava cautions, however, that the US may find new reasons for tariffs, keeping India under continuous has built a buffer against such pressures. Exports constitute roughly 20% of GDP, compared with 90% for Vietnam, a country far more vulnerable to US-imposed shocks. 'Vietnam will suffer more. We will suffer, but we will absorb it properly. Country will bounce back. All we need to do is not to surrender,' Srivastava US consumers will also feel the impact of tariffs. About 90% of prescriptions in the US rely on generics imported from India. While the total trade value may be under $10 billion, disruption affects the majority of prescriptions, potentially raising prices significantly. Companies may eventually source alternatives over three to four months, but the immediate effect is inflationary.'Indian exports will suffer, but we need to consider whether it's better to endure this and use it to push delayed reforms, like diversifying exports, rather than falling into a bad deal. This isn't really about trade; it's about surrendering sovereignty,' Srivastava Srivastava, Trump's broader strategy is political theatre. 'Basically, he wanted to hit China. He couldn't, so he has to show his domestic voters that he is a big man, that a bully can show strength by hitting someone. He couldn't hit China, so let's hit India, that's the only thing.'With China, Trump launched a trade war over the large trade deficit, but Beijing hit back by restricting supplies of critical materials, he noted. 'India hasn't used those levers, which is why Washington expected Delhi to yield immediately.'India's refusal to play a compliant role, unlike Pakistan, frustrates Trump. At the same time, India maintains strategic autonomy, engaging with Russia on defence, limiting deep Chinese investment to marketing and distribution, and managing relations with the US on equal footing. 'We are a big country, big economy, and so we have to have workable, good relations with everyone, without being in anybody's camp,' Srivastava pre-Galwan, Chinese investment has been superficial. 'China doesn't invest in deep manufacturing. They will not supply any technology. They will invest in marketing of cars, garments, two, $5 billion here and there, but we don't want that. So we have to evaluate very carefully,' he says.'We can have targeted strategic relationships, like with Russia for defence, but moving closer to China is complicated. There's the border dispute and a $100 billion trade deficit,' he export-oriented economy, diversified supply chains and robust domestic market allow it to absorb short-term shocks while resisting long-term concessions. 'All we need to do is not enter into any relationship that costs us the medium or long term,' Srivastava takeaway is clear: Trump's tariffs are less about trade and more about leverage. Every tweet, every tariff threat, every demand is a political signal designed to demonstrate strength to domestic voters. 'Every day he abuses us on Twitter. That shows India has entered his mind,' Srivastava response emphasises sovereignty, resilience and strategic foresight. "Trade deal is not a trade deal. It's about bargaining for your sovereignty. And India is not bargaining."
Economic Times
19 minutes ago
- Economic Times
PPI inflation shock rocks Wall Street and Trump — big Fed rate cut dreams go up in smoke
The latest PPI data shows a sharp 0.9% jump, the fastest since May 2022, with core prices climbing 0.6%. Even as jobless claims eased slightly, investors are rethinking bets on a big September rate cut. Synopsis July PPI report jolts markets — big Fed rate cut dreams fade: Wholesale prices jumped 0.9% last month, the fastest since May 2022, while core PPI rose 0.6%, signaling persistent inflation. Jobless claims eased slightly to 224,000, but investors are cautious as hopes for a large September rate cut slip away. U.S. wholesale prices surged in July, with the Producer Price Index (PPI) climbing 0.9%, marking the fastest monthly increase since May 2022. Rising costs for food and services drove much of the increase, signaling that inflationary pressures remain persistent. Core PPI, which strips out volatile food and energy costs, rose 0.6%, highlighting underlying price growth that could influence Federal Reserve decisions in the coming months. ADVERTISEMENT At the same time, jobless claims eased slightly to 224,000 from 227,000 the previous week, showing that the labor market remains relatively strong but may be starting to soften. This combination of higher wholesale prices and easing employment signals a delicate balancing act for the Fed: controlling inflation without slowing the economy too abruptly. Investors reacted cautiously to the data. S&P 500 futures fell 0.3% as traders digested the potential implications for interest rate policy. Market expectations for a 25-basis-point rate cut in September remain high but have moderated slightly, while hopes for a larger 50-basis-point reduction have diminished. ALSO READ: Ethereum surges 16% to $4,783 in 5 days — is a $5K breakout now inevitable as analysts eye $15K by year-end? For everyday Americans, rising wholesale prices often translate into higher costs for goods and services, from groceries to household essentials. Businesses are also adjusting, with manufacturers and suppliers already recalibrating contracts to hedge against continuing price pressures. Monthly change: +0.9% (largest monthly rise since May 2022) +0.9% (largest monthly rise since May 2022) Annual change: +3.3% (up from 2.4% in June) +3.3% (up from 2.4% in June) Goods prices: +0.7% (food, durable goods lead increase) +0.7% (food, durable goods lead increase) Services prices: +1.1% (largest contributor to overall rise) ADVERTISEMENT Wholesale prices surged in July, with the Producer Price Index (PPI) climbing 0.9% month-over-month — the largest increase since May 2022. Goods prices rose 0.7%, led by food and durable goods, while services jumped 1.1%. On an annual basis, PPI inflation accelerated to 3.3% from June's 2.4%, surpassing most economists' forecasts. ALSO READ: XRP price prediction: whales stir as XRP slips 2% but clings to $3.20 — breakout or sharp reversal ahead? ADVERTISEMENT Excluding volatile food and energy costs, core PPI jumped 0.6% in July, marking its steepest monthly rise in three and a half years. The annualized core rate now sits at 2.8%. For context, this core reading is critical because it reflects underlying inflation trends that most directly influence Federal Reserve policy. Monthly change: +0.6% (largest monthly gain in 3.5 years) +0.6% (largest monthly gain in 3.5 years) Annual change: +2.8% Wholesale price inflation often filters down to retail prices, impacting everything from groceries to housing costs. Companies facing higher input costs may pass them to consumers, fueling further price pressures. For households, even moderate increases in the PPI can translate to noticeable jumps in daily spending, particularly in food and energy. ADVERTISEMENT First-hand insights from industry sources indicate that manufacturers in the Midwest are already recalibrating supply contracts to hedge against rising costs. One executive in Chicago's food processing sector noted, 'We're seeing supplier prices move faster than our forecasts. Some of that will inevitably hit store shelves by early fall.' Contrasting with inflation pressures, initial unemployment claims dropped slightly to 224,000 from 227,000 the previous week. This subtle decline signals a modest softening in the labor market — not a major downturn, but enough to hint that employers may be pausing aggressive hiring. ADVERTISEMENT Historically, a stable or slightly easing job market can balance inflationary pressures, giving the Fed more flexibility to moderate policy without derailing growth. Analysts caution, however, that persistent inflation in goods and services could still force a more cautious stance. Initial claims: 224,000 (down from 227,000 previous week) 224,000 (down from 227,000 previous week) Implication: Slight labor market softening; not a major downturn Following the PPI release, S&P 500 futures dipped roughly 0.3%, reflecting investor concerns over rising costs and potential Fed interventions. Markets are still pricing in a 94.5% probability of at least a 25-basis-point rate cut in September, slightly down from 100% before the data. Expectations for a larger 50-basis-point cut have softened, showing that traders are weighing inflation data heavily in their Fed bets. Major tech stocks, historically sensitive to interest rate moves, also felt pressure. Analysts note that even a moderate slowdown in anticipated rate cuts could affect valuations for high-growth firms. S&P 500 futures: Fell by 0.3% after the PPI release Fell by 0.3% after the PPI release Fed rate expectations: Probability of 25-basis-point cut in September: 94.5% (down from 100% pre-data) Probability of 50-basis-point cut: Lower than prior expectations The Fed faces a delicate balancing act: strong inflation signals suggest caution, while a gradually cooling labor market argues for support. In practice, policymakers will likely emphasize data dependency, monitoring upcoming reports such as the August Consumer Price Index (CPI) and retail sales before making decisions. Fed watchers highlight that core PPI, which strips out volatile items, is particularly influential. If these underlying trends remain elevated, the Fed may need to reassess the magnitude of the September rate cut, potentially delaying or reducing it. For investors, rising wholesale costs may shift portfolios toward inflation-resistant sectors, such as commodities, utilities, or dividend-paying stocks. Bonds could also see volatility if market expectations for Fed moves continue to adjust. Consumers should anticipate incremental price increases in essential goods, particularly food and energy. Budget planning for households may need to account for a 3–5% rise in certain goods over the next few months, depending on supply chain adjustments. July's PPI and jobless claims provide a snapshot of the economic balancing act facing the U.S.: inflation pressures remain, but the labor market shows signs of moderation. The next few weeks of economic data will be crucial in shaping the Fed's September policy and market sentiment. Investors, businesses, and households alike are advised to watch for signals from upcoming CPI readings, retail sales reports, and corporate earnings updates. Q1: What caused U.S. wholesale inflation to rise in July? July's PPI jump was driven by higher food and service costs, pushing inflation above expectations. Q2: How did jobless claims affect market outlook in July? Falling jobless claims signaled slight labor market easing, influencing S&P 500 futures and Fed rate expectations. (You can now subscribe to our Economic Times WhatsApp channel) (Catch all the US News, UK News, Canada News, International Breaking News Events, and Latest News Updates on The Economic Times.) Download The Economic Times News App to get Daily International News Updates. NEXT STORY
