Trump intensifies pressure on Fed chair amid China trade talks
In recent days, President Donald Trump has intensified his criticism of Federal Reserve Chairman Jerome Powell. He called the head of the U.S. central bank a "major loser," but insisted on Tuesday that he doesn't plan to fire him. However, he is demanding action regarding interest rates.
Recently, President Trump escalated his critique of the policy conducted by Federal Reserve Chairman Jerome Powell. On his social media platform, he wrote that if the central bank chief does not immediately lower interest rates, the economy will significantly slow down.
Earlier, Trump mentioned that he couldn't wait for Powell's "termination," fueling speculation about a possible dismissal of the Fed chief. The President also argued that if he desires, the central bank chairman, whose term ends next year, will leave his position.
During the swearing-in ceremony of Securities and Exchange Commission (SEC) Chairman Paul Atkins, Trump referred to the issue again.
- I have no intention of firing him. I wish he were a bit more active in his idea of lowering interest rates. This is the perfect time to lower interest rates. And if he doesn't, is it over? No, it's not over - Trump said.
Relations with China
The President also addressed trade relations with China, promising to be "very nice" in talks with Chinese leader Xi Jinping. Trump suggested that tariffs on Chinese products could be reduced after a trade agreement is reached.
- I’m not going to say, ‘Oh, I’m going to play hardball with China, I’m going to play hardball with you, President Xi.’ No, we’re going to be very nice. We’ll see what happens. But ultimately, they have to make a deal, because otherwise they’re not going to be able to deal in the United States - he added.
Trump's words caused anxiety in financial markets, leading to declines on Wall Street. Powell had earlier signaled that he would hold off on lowering interest rates, pointing to uncertainty and possible inflation acceleration caused by Trump's tariffs.
According to reports from Bloomberg, Treasury Secretary Scott Bessent, at a closed conference organized by JP Morgan, assessed that negotiations with China would be a "slog." He also reportedly said that the U.S. does not intend to "decouple," or sever economic ties with the PRC, although the current tariff levels - 145% on products from China and 125% on products from the U.S. - effectively constitute an embargo.
