Trump has a surprising update on the future of Fed boss Jerome Powell – as interest rate decision announced

The Federal Reserve has cut interest rates amid reports that Donald Trump will let Chairman Jerome Powell remain in office until 2026.

The central bank cut by 25 basis points on Thursday, bringing interest rates down between 4.5 percent and 4.75 percent.

Lower rates are good news for consumers because it makes borrowing money cheaper, and should mean cheaper loans and credit card rates eventually trickle down to Americans.

It is the second time in a row that the Fed, led by Powell, has cut rates this year, after an aggressive rate hike campaign to curb inflation.

The decision comes days after Trump made a political comeback by defeating Kamala Harris and winning the race to become the 47th president of the United States.

During his election campaign, Trump had expressed frustrations with Powell and even threatened to remove him from his role as Fed chairman — an unprecedented step for any president.

The Federal Reserve has cut interest rates amid reports that Donald Trump will let Chairman Jerome Powell remain in office until 2026.

“I think the president should at least have a say in that,” Trump said during his campaign cycle.

“In my case, I made a lot of money, I was very successful, and I think I have better instincts than, in many cases, people who would be at the Federal Reserve, or the chairman.”

But he is now expected to let Powell stay in his job until the end of his term in May 2026, the newspaper said. CNN.

While Trump could still change his mind, the current thinking among him and his economic team is that Powell will remain at the helm of the central bank as it works to cut rates.

Powell, a Republican with a background in private equity, was originally appointed to lead the Fed by Trump in 2018. President Joe Biden later reappointed him for a second term.

Trump has also criticized the Fed’s lack of transparency, criticizing its private policy meetings and delayed release of discussion papers.

According to CNN, Trump’s aides have suggested he would prefer real-time publication of Fed minutes and economic reports, with meetings held on camera for greater public insight.

During Trump’s first term, he and Powell clashed repeatedly. In 2018, Trump openly considered replacing Powell after a central bank rate hike, although the president legally cannot fire Fed chairman unless he breaks the law.

Thursday’s decision marks the second time the Fed has cut rates this year, against the backdrop of a slowing labor market and cooling inflation.

Policymakers voted in September to cut rates by as much as 50 basis points, pushing borrowing costs down from a 23-year high.

During his election campaign, Trump expressed frustrations with Powell and even threatened to remove him from his role as Fed chairman – an unprecedented move for any president.

Experts note that while the decision to keep Powell as Fed chairman is significant, it could be overshadowed by the potential economic changes that a second Trump administration could bring.

Trump’s recent election victory and the likelihood of a Republican-controlled Congress in January point to possible policy shifts — from tariffs to tax cuts and limited immigration — that could reshape the economic landscape Fed policymakers anticipated next year.

While these changes could take months to get through Congress, even with a Republican majority, they have the potential to significantly change the country’s prospects for growth and inflation.

Economists across the political spectrum have warned that Trump’s policies could reignite inflation — thereby delaying or halting the Fed’s moves to cut rates.

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