Trump Pressures Fed to Cut Rates as Tariff Concerns Grow

President Donald Trump said the Federal Reserve should cut interest rates, splitting with the U.S. central bank as officials weigh the economic cost of his tariff push.

“The Fed would be MUCH better off CUTTING RATES as U.S.Tariffs start to transition (ease!) their way into the economy,” Trump said in a post on Truth Social. “Do the right thing. April 2nd is Liberation Day in America!!!”

Trump’s post the evening of March 19 comes as his administration prepares to unveil a fresh wave of tariffs, which Federal Reserve Chair Jerome Powell signaled was hanging over forecasts.

Fed officials held their benchmark interest rate steady on March 19 for a second straight meeting, as expected by economists. Powell downplayed simmering concerns about a slowdown but acknowledged tariff uncertainty was a factor and already contributing to goods inflation, but may prove transitory.

Trump’s administration is preparing to announce a fresh wave of tariffs on April 2, though the exact scope isn’t clear. Trump has promised so-called “reciprocal” tariffs on at least some nations, though his administration has not specified which ones or at what rate, and his key economic advisers have competing views on the best way to approach tariff policy.

The public pushback on interest rates comes as the Trump White House tries to make its case for stiffer tariffs amid a mixed economic picture in the U.S. Inflation has not abated as much as American consumers would like. High interest rates are squeezing the housing market, and economists now see economic growth slowing in the upcoming months.

Trump has sent repeated mixed messages on the Fed — at times calling for cuts and otherwise declining to intervene. Similarly, during the campaign, he vacillated on how independent he said the Fed should be from the White House.

His move this week to dismiss two Democrats on the Federal Trade Commission has raised questions about how widely Trump will seek to remake independent agencies.

Asked March 20 whether Trump would consider dismissing members of the Fed board, White House Press Secretary Karoline Leavitt sidestepped the question and praised his recent move to nominate Michelle Bowman to serve as the central bank’s vice chair for supervision.

“We’re incredibly optimistic about her,” Leavitt told reporters at the White House. “The president has every right to criticize the decision. And he’s made it very clear that he believes lower interest rates are going to help make this country boom.”

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Powell will be allowed to serve out the remainder of his term, Trump has said. (Al Drago/Bloomberg News)

Trump has said he intends to allow Powell, whom he appointed to the post in 2018, to serve out the remainder of his term. Yet he also cast Powell’s decision to cut interest rates before the November presidential election as politically motivated and intended to bolster Democrats.

Trump ultimately prevailed in the election and has mused in the past about seeking to exert more influence over the central bank, which traditionally maintains independence from the White House. He has said a president should be able to weigh in on interest rate decisions.

“I don’t think I should be allowed to order it, but I think I have the right to put in comments as to whether the interest rates should go up or down,” Trump said in an interview with Bloomberg News at the Economic Club of Chicago in October.

Many of his top economic advisers, however, have argued that the Fed must remain independent to preserve people’s faith in the U.S. economic system and the markets.

Earlier March 19, Trump’s national economic adviser, Kevin Hassett, stressed to reporters that the president and White House officials “very much respect the independence of the Fed.”

Even so, he made clear to reporters he differed with the Fed’s growth forecast, saying he anticipated a 2.5% growth rate. Fed officials are now predicting a 1.7% expansion.