President Trump, who has fumed over the Federal Reserve’s refusal to lower interest rates, sent an unfriendly note to Chairman Jerome Powell chiding him about the more favorable rates set in dozens of other countries.
“Jerome — You are, as usual, ‘Too Late’.You have cost the USA a fortune and continue to do so. You should lower the rate — by a lot!” he wrote.
The president delivered his accusatory missive to Mr. Powell on a memo listing the interest rates in other countries. Switzerland, Cambodia, Japan, Denmark, Seychelles and Thailand have the lowest interest rates ranging from 0.25% to 1.75%. Mr. Trump wrote to Mr. Powell that U.S. interest rates should be in the same range as in those countries.
“Hundreds of billions of dollars being lost! No inflation,” he wrote to Mr. Powell.
The Fed earlier this month kept interest rates at 4.25-4.50%, ignoring Mr. Trump’s demands to lower them.
Mr. Trump initially threatened to replace Mr. Powell when he took office in January but now seems more inclined to wait for the end of Mr. Powell’s term as chairman, which expires next May.
During Monday’s White House press briefing, press secretary Karoline Leavitt held up Mr. Trump’s note to Mr. Powell. She said Mr. Powell cut rates several times ahead of the 2024 election “but now refuses to, when the economy is in a much better place,” due to Mr. Trump’s policies.
Ms. Leavitt said the Fed is politicized and lacks a good reason for declining to lower interest rates below the current level, “and the president is rightfully calling attention to that.”
Fed officials cut rates multiple times in 2024 as inflation cooled, though they haven’t budged on rates since the start of this year.
The Fed is on track for two rate cuts later in the year, but raised concerns about the potential for slower growth and higher inflation.
Mr. Powell said Mr. Trump’s tariffs on imported goods could cause short-lived inflation.
“It’s also possible the inflationary effects could be more persistent,” Mr. Powell said on June 18, adding it depends on the magnitude of tariffs after Mr. Trump’s negotiations with other nations. The president has set a July 9 deadline for deciding tariff rates.
Ms. Leavitt told reporters there is an economic boom, with inflation is decreasing, the stock market gaining, and energy prices going down.
“The one problem that remains is high interest rates for the American people,” Ms. Leavitt said. The American people want to borrow money cheaply. And they should be able to do that.”
• Tom Howell contributed to this report.
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