In Visit to Federal Reserve Building, Trump Pushes for Big Cuts to Interest Rates
The president and some of his allies toured the Federal Reserve buildings under construction on Thursday. In the past two weeks, Trump has ramped up his criticism of the cost overruns on the building project. Analysts said Trump's public upbraiding of the construction was potentially laying the groundwork for firing Fed Chair Jerome Powell.
Trump seemingly walked back some of his threats against Powell, saying he didn't believe it was 'necessary' to fire him. However, Trump did not back off from his insistence that the central bank should cut its influential federal funds rate at its meeting next week.
Trump said the Fed's stance on interest rates is holding back economic progress. The Federal Reserve has held interest rates in the 4.25% to 4.5% range throughout the year as it waits to see how tariffs will affect the economy.
'Everything is good. The one thing we have to do is get housing prices down and get interest rates down so people can buy a house,' Trump said.
Trump said interest rates should be cut by three percentage points. However, that is unlikely to happen in one meeting. The Fed typically makes cuts of a quarter-point at a time. The last time the Fed cut rates an entire percentage point was March 2020 at the start of the COVID-19 pandemic. Before that, they cut one percentage point in December 2008, during the Great Recession.
Trump's allies are also pressuring Powell and his colleagues. According to a Bloomberg News report, Azoria Capital's James Fishback filed a lawsuit today to force the Federal Reserve to open up meetings of the Federal Open Market Committee to observers. The Fed has always conducted its meetings behind closed doors.
Presidents have rarely visited the Federal Reserve, with former President George W. Bush's visit in 2006 being the last time it occurred.
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