Donald Trump criticises Jerome Powell, warns of slowdown unless Fed cuts rates

US President Donald Trump on Monday criticised Federal Reserve Chairman Jerome Powell’s stance on benchmark interest rates, accusing him of not acting swiftly enough in easing the monetary policy while claiming that there is “virtually no Inflation” in the world’s largest economy. Asserting that costs for energy and “most other things” are on the decline, the 47th US President, who took office in January, said that his team is studying the legalities of removing the central banker before the end of his current term.

How Dow Jones & dollar fare after Donald Trump’s remarks on Jerome Powell

Trump’s remarks, once again, caused tremors across Wall Street, while sending the dollar index tumbling to the lowest point in almost three years. The Dow Jones Industrial Average (DJIA) index slumped to as low as 37,830.7, giving up 1,311.6 points, or 3.4 per cent, from its previous close. 

Trump posts on Truth Social

In a post on social media network Truth Social, Trump wrote that “many” are calling for “pre-emptive cuts” in benchmark interest rates, with energy costs way down, food prices substantially lower, and virtually no inflation while “most other things” trending down. 

“With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW. Europe has already ‘lowered’ seven times. Powell has always been ‘To Late’, except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected. How did that work out?”wrote President Trump on the platform. However, it could not be ascertained immediately as to whom the US President was referring to as having called for the pre-emptive cuts.

‘Slowdown if no rate cuts’ 

Trump also said that the American economy could slow down unless the Fed reduces the key interest rates immediately. He also said his team is studying whether they can legally remove the current Fed Chairman before his term expires.

Powell was appointed at the top helm of the US central bank during Trump’s first term as President. Powell’s current term as central bank chief expires in May next year.

Down slumps as the bulls bear the brunt of Trump remarks again 

The US market has staged wild swings over the past few weeks, thanks to heightened uncertainty amid back and forth with trade tariffs and growing concerns about their potential impact on growth and consumer prices.

Last week, Powell said that the ongoing tade war will hinder growth and cause inflationary pressure.