Donald Trump has launched his latest attack on the US central bank, saying the interest rate setters had “failed”.
Over the weekend, he said he wanted interest rates to be 1% and that he would “love” for Jerome Powell, the chair of the Federal Reserve, to resign.
It comes less than two weeks since he called Mr Powell a “stupid person” and said: “Maybe I should go to the Fed. Am I allowed to appoint myself at the Fed?”
In a post on his Truth Social platform on Monday, Mr Trump said: “Jerome ‘Too Late’ Powell, and his entire board, should be ashamed of themselves for allowing this to happen to the United States.”
It was not clear what Mr Trump was referring to when referencing “this”.
“If they were doing their job properly, our country would be saving trillions of dollars in interest cost. The board just sits there and watches, so they are equally to blame,” the post read.
“We should be paying 1% interest, or better!”
A message to Mr Powell was also written on a leaderboard of countries’ interest rates, ranked from low to high, showing the US ranked 35th, coming behind the United Arab Emirates and the UK.
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The Federal Reserve, known as the Fed, had held the cost of borrowing at 4.25%-4.5%. Unlike the UK, the US interest rate is a range to guide lenders rather than a single percentage.
Despite the threats from Mr Trump and from his press secretary Karoline Leavitt, who told reporters inflation was “completely diminished”, markets are not expecting a cut when the Fed next considers interest rates next month.
In fact, no reduction is currently anticipated until September.
Are interest rates really that high in the US?
Not since December last year has the rate been cut.
The Fed has expressed concern about the impact of Mr Trump’s signature economic policy of implementing new tariffs, taxes on imports to the US.
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Trump’s tariffs: What you need to know
Inflation – the overall rate of price rises – has ticked up to 2.4% while the Fed said it expected further rises due to tariffs.
Interest rates have been hiked in an effort to bring inflation down to the Fed’s 2% target.
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It has meant the cost of borrowing is slightly higher than in the UK, where the Bank of England has set rates at 4.25%.
It’s also above the level of euro-using countries, where the European Central Bank has set rates at 2%.
What’s the reaction been?
Mr Powell has not retaliated, and the Fed declined to comment on Monday.
There was little market reaction as major US stock indexes had hit record highs amid hopes of trade deals with countries, rather than a return of country-specific tariffs.
Ironically, the dollar has been at a more than three-year low over worries of the US deficit expanding further with Mr Trump’s so-called “Big, Beautiful Bill” being voted on.
The fact that interest rate cuts could come in recent months is also contributing, as currencies tend to be supported by higher rates as they can attract foreign investment.
In the past, comments about replacing Mr Powell, appointed by President Trump in 2017, have led to concern from investors, which saw Mr Trump say he would not replace the chair before his term ends in May 2026.
