Breaking: Trump Criticizes Jerome Powell and Calls for Fed to Override His Leadership

President Donald Trump has escalated his public criticism of Federal Reserve Chairman Jerome Powell, calling for the Fed’s Board of Governors to take control of policy decisions if Powell refuses to implement immediate interest rate cuts.

In a fiery post on his Truth Social platform on Friday, Trump slammed Powell as a “stubborn moron” and urged the central bank to act swiftly to address what he perceives as a sluggish response to the economy’s needs.

Trump’s remarks come at a time when the Federal Reserve is facing mounting pressure to take more aggressive steps to stimulate the economy amid persistent inflation and an unexpectedly weak jobs report. 

Despite having appointed Powell to lead the Fed in 2017, Trump has frequently criticized the chairman’s leadership and his handling of monetary policy.

In his latest post, Trump called on the Federal Reserve’s Board of Governors to step in if Powell does not implement the necessary cuts to interest rates.

“Jerome 'Too Late' Powell, a stubborn MORON, must substantially lower interest rates, NOW.

IF HE CONTINUES TO REFUSE, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!” Trump wrote early Friday morning.

This was his latest in a series of public critiques targeting Powell’s leadership at the central bank, reflecting Trump’s ongoing dissatisfaction with the Fed’s approach to economic policy.

Trump’s criticism is rooted in his belief that the Fed’s current policy stance is not aggressive enough in addressing the challenges facing the U.S. economy.

Since the pandemic recovery, the central bank has raised interest rates to combat inflation, but Trump has been vocal in calling for rate cuts to encourage economic growth, especially amid concerns about rising inflation and a sluggish labor market.

The Fed’s policy decisions are made collectively by the Federal Open Market Committee (FOMC), a 12-member panel that includes Powell and other policymakers.

The committee votes on key decisions, with each member having a voice in the process.

However, Powell, as the chairman, has considerable influence over the direction of policy, which has made him the target of criticism from Trump, especially when the Fed has held rates steady or raised them in recent months.

Trump’s call for the Board of Governors to assume control reflects his frustration with Powell’s reluctance to implement more aggressive cuts to interest rates.

Powell has expressed caution about cutting rates too quickly, citing ongoing economic uncertainty, including labor market conditions and the potential impact of tariffs on inflation.

This has led Trump to accuse the Fed of being too slow in responding to economic conditions and too conservative in its approach to monetary policy.

The Federal Reserve’s most recent decision to keep interest rates steady came on Wednesday, marking the fifth consecutive meeting in which the central bank opted not to make a change.

Powell cited various economic uncertainties as the reason for the pause, including concerns over the labor market and inflationary pressures tied to tariffs and global supply chain disruptions.

“While inflation is still above the Fed’s 2% target, we believe the economy is in a solid position, and we are well-positioned to respond if there are signs of economic deterioration,” Powell said during the press conference following the FOMC meeting.

Powell’s cautious tone reflects a belief that the economy is still relatively resilient, despite the challenges posed by inflation and global economic uncertainties.

However, this stance has drawn the ire of Trump, who has consistently argued that the Fed’s policies are too restrictive and are hampering the economic recovery.

Trump has suggested that the Fed could do more to stimulate growth, especially as inflation continues to rise and employment data shows signs of weakness.

Trump’s call for a more aggressive policy response reflects his broader view that the central bank’s actions have a direct impact on the U.S. economy’s performance, particularly when it comes to job creation and consumer spending.

One of the central issues in the debate between Trump and the Federal Reserve is inflation.

Inflation has been a persistent concern for policymakers and consumers alike, with the prices of goods and services rising significantly in recent months.

On Thursday, the Commerce Department released data on the Personal Consumption Expenditures (PCE) index, which is the Fed’s preferred measure of inflation.

The PCE index showed that inflation rose to 2.6% on an annual basis in June, up from 2.3% in May, well above the Fed’s long-term target of 2%. This rise in inflation has dampened market expectations for a rate cut at the Fed’s next meeting in September.

However, the unexpected weakness in the July jobs report released on Friday morning has led to a shift in market sentiment.

The report showed that the U.S. economy added only 74,000 jobs in July, far below the 110,000 jobs that economists had expected. Additionally, the report included significant downward revisions to previous job gains, with the May and June figures being revised down by a combined 258,000 jobs.

The disappointing job numbers have reignited speculation that the Fed may need to consider a rate cut sooner rather than later.

As the jobs report showed weaker-than-expected job creation, market expectations for a September rate cut surged.

According to the CME FedWatch tool, the probability of a 25-basis-point rate cut jumped to 78.8% on Friday, up from just 37.7% a day earlier, reflecting the market’s reassessment of the economic outlook in light of the weak jobs data.

Trump’s recent remarks are part of a broader narrative in which he has repeatedly criticized Powell for not acting aggressively enough to stimulate the economy.

Despite having appointed Powell to lead the Federal Reserve in 2017, Trump has consistently argued that the central bank should be doing more to support economic growth, particularly in the wake of the pandemic.

In the past, Trump has called Powell “the most overrated person” and described his leadership at the Fed as a “disaster” for the economy.

Trump’s attacks on Powell have become more pointed in recent months, especially as inflation remains stubbornly high and economic growth appears to be slowing.

Trump has repeatedly urged Powell to take immediate action to lower interest rates, claiming that doing so would lead to a stronger economy, more jobs, and better outcomes for American families.

Trump has also suggested that the Fed’s policies have been a key obstacle to his economic agenda, particularly as the central bank’s interest rate hikes have made borrowing more expensive for consumers and businesses.

In his Truth Social post on Friday, Trump was clear in his frustration with Powell’s leadership: "If he continues to refuse, the Board should assume control and do what everyone knows has to be done!"

This statement reflects Trump’s belief that Powell’s reluctance to lower interest rates quickly is preventing the economy from reaching its full potential.

Trump’s call for the Board of Governors to step in and override Powell’s decisions, while unlikely, underscores the tension between the president and the Fed chairman.

As the debate over interest rates continues, the future direction of the U.S. economy remains uncertain. The Federal Reserve faces the difficult task of balancing inflationary pressures with the need to support economic growth and job creation.

With inflation still above target and the labor market showing signs of weakness, the Fed will need to carefully consider its next steps.

The August and September meetings of the Federal Open Market Committee will be pivotal in determining the central bank’s response to the changing economic landscape.

If inflation continues to rise and the job market remains weak, the Fed may face increasing pressure to cut rates in order to provide more support to the economy.

However, the risks of acting too quickly could also lead to renewed inflationary pressures, making the Fed’s decision-making process more challenging.

Trump’s public attacks on Powell and his calls for the Fed to act more aggressively reflect a broader frustration with the central bank’s approach to economic policy.

As the economy continues to navigate uncertainties, it remains to be seen whether the Fed will heed Trump’s calls or stick to its current approach of gradual adjustments to interest rates.

Regardless of the outcome, the debate over the Fed’s role in the economy is likely to remain a central issue in U.S. economic policy discussions in the months ahead.