WASHINGTON — President Trump called Federal Reserve Chairman Jerome Powell to the White House Thursday to demand a cut in interest rates — pointing to a dramatic decline in inflation since its peak under former President Joe Biden.
Trump, 78, told Powell, 72, that “he believes the Fed chair is making a mistake by not lowering interest rates, which is putting us at an economic disadvantage to China and other countries,” White House press secretary Karoline Leavitt told reporters after the private meeting.
“The president’s been very vocal about that, both publicly and, now I can reveal, privately,” she said.
The Federal Reserve’s press office said that “[a]t the President’s invitation, Chair Powell met with the President today at the White House to discuss economic developments including for growth, employment, and inflation.”
Powell “did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook,” that statement said.
“Powell said that he and his colleagues on the [Federal Open Market Committee] will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis.”
The central bank’s benchmark rate has remained between 4.25% and 4.5% since Trump took office in January. It was last lowered in December 2024 by 0.25 percentage points.
The annual inflation rate dropped to just 2.3% in April, according to the Bureau of Labor Statistics’ Consumer Price Index — roughly in line with the Fed’s target of 2% and down significantly from its peak of 9.1% in June 2022.
The benchmark figure — which is up to two percentage points higher than its peak during Trump’s first term — impacts the cost of business loans as well as consumer credit cards and mortgages.
The average 30-year mortgage rate remains at just under 6.9% , according to the St. Louis Fed — much higher than the 4.9% peak during Trump’s first term, reached in late 2018.
Average credit card interest rates currently are 28.67%, according to Forbes Advisor — almost double the 14.6% average when Trump ended his first term.
Ahead of his meeting with Powell, Trump posted on Truth Social an article featuring Federal Housing Finance Agency Director Bill Pulte’s call for lower rates.
“Jay Powell needs to lower interest rates — enough is enough,” Pulte said. “President Trump has crushed Biden’s inflation, and there is no reason not to lower rates. The housing market would be in much better shape if Chairman Powell does this.”
Trump also has pointed to the fact that the European Union has much lower interest rates — despite a similar inflation rate. The European Central Bank cut its benchmark rate to 2.25% last month.
Federal Reserve leaders have cited uncertainty about the impact of Trump’s tariffs as one reason for not more swiftly cutting rates — with Chicago Fed President Austan Goolsbee saying Thursday that “if on the back end of this thing, either we don’t put the tariffs in, or they reach some deals that allow us to avoid doing that, we could go back to what we were prior to April 2.”
