While the rest of the world cuts interest rates to boost their economies, Jerome Powell keeps America’s money expensive and Trump is furious – claiming a rate cut would be “jet fuel” for economic growth.
At a Glance
- President Trump believes cutting interest rates would act as “jet fuel” for the U.S. economy as the Fed keeps rates unchanged for the third consecutive meeting
- Trump criticized Fed Chair Jerome Powell for not following other central banks worldwide that have already cut their rates
- Powell claims Trump’s criticism does not influence Fed decisions, which are supposedly based solely on economic data
- Fed officials express concerns about tariffs potentially causing inflation and economic slowdown, but still refuse to lower rates
- Investors don’t anticipate a rate cut until July, despite Trump’s warnings of economic slowdown without action
Trump Demands Economic “Jet Fuel” as Fed Sits Idle
The Federal Reserve just gave Americans the economic equivalent of a shoulder shrug, keeping interest rates between 4.25% and 4.5% for the third consecutive meeting while central banks around the world are actually taking action to stimulate their economies. President Trump wasted no time blasting this inaction, arguing that cutting rates would serve as powerful “jet fuel” for the American economy. It’s not complicated – lower rates mean cheaper borrowing costs, which stimulates investment, growth, and jobs. But apparently that concept is too advanced for the Fed chair who seems determined to keep our economic engine running on fumes.
In a classic showing of bureaucratic inflexibility, Jerome Powell continues maintaining the current monetary policy is “appropriate” despite mounting evidence to the contrary. Meanwhile, other central banks, including the Bank of England, have already reduced their interest rates, recognizing the potential economic impacts of U.S. tariffs and positioning their economies for maximum advantage. When other nations are taking proactive measures to bolster their financial systems while we sit back and watch, you have to wonder whose interests Powell is really serving – because it certainly doesn’t seem to be the American worker or business owner.
🇺🇸Fed's Powell Holds Steady on Rates, Rejects Preemptive Cuts Amid Tariff Uncertainty
The Federal Reserve held interest rates steady at 4.25%–4.5% at its May meeting, as Chair Jerome Powell rejected the idea of a preemptive rate cut in response to President Donald Trump’s…— CN Wire (@Sino_Market) May 7, 2025
Powell’s Independence or Political Obstruction?
The Fed chairman has been quick to wrap himself in the cloak of “independence,” claiming Trump’s criticism has zero influence on their policy decisions. “We are always going to do the same thing, which is we are going to use our tools to foster maximum employment and price stability for the benefit of the American people. We are always going to consider only the economic data, the outlook, the balance of risks, and that’s it. That’s all we are going to consider,” Powell stated, as if reading from a bureaucrat’s handbook on how to ignore common sense while sounding responsible. But this independence looks suspiciously like obstruction when the Fed refuses to act while international counterparts move forward.
“The past few weeks have shown how unpredictable the global economy can be. That’s why we need to stick to a gradual and careful approach to further rate cuts.” – Bank of England Gov. Andrew Bailey
Trump has not minced words about Powell’s leadership, even hinting at the possibility of terminating him, which sparked predictable outrage about Fed independence. But here’s the more important question no one seems to be asking: why should Americans suffer under unnecessarily high interest rates when the conditions clearly warrant relief? The Fed’s own data shows inflation was moderate in March, with prices up just 2.3% from the previous year. Energy prices are down. Employment is strong. Yet Powell clutches his pearls at the mere suggestion of lowering rates to boost American business and consumers.
President Trump Friday said the U.S. economy is in a transition stage, citing strong employment and his tariff plan, while reiterating his call for the Federal Reserve to lower its interest rate. https://t.co/nm0tFPtgIt
— NEWSMAX (@NEWSMAX) May 2, 2025
The Tariff Excuse and Market Realities
The Fed’s latest excuse for inaction centers on President Trump’s proposed tariffs, with Powell claiming these might cause inflation and slower growth. This argument completely misses the point. If you’re worried about potential economic headwinds, wouldn’t you want to give businesses and consumers some financial breathing room by lowering rates? Instead, the Fed is effectively tightening the economic noose by keeping borrowing costs high while simultaneously warning of trouble ahead. This isn’t just inconsistent policy making – it’s economically self-defeating.
“The level of the tariff increases announced so far is significantly larger than anticipated. The same is likely to be true of the economic effects, which will include higher inflation and slower growth.” – Fed Chair Jerome Powell
What makes this situation even more frustrating is that market analysts now believe Americans won’t see any relief until at least July, according to CME FedWatch data. That’s months of unnecessarily high interest rates weighing down our economy while other nations move ahead. The Atlanta Fed’s GDPNow Model predicts just 2.3% economic expansion in the second quarter – not terrible, but far from the robust growth America is capable of with the right policies. President Trump has it exactly right – a rate cut would be economic jet fuel. But instead of filling the tank, Powell and his Fed colleagues are making us all push the car uphill while they lecture us about “appropriate monetary policy.”
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