By US President Donald Trump ramped up his attacks on Federal Reserve Chair Jerome Powell on Friday, urging the Fed’s board of governors to take over if Powell doesn’t move quickly to slash interest rates.
The statement came after the Fed held its key interest rate steady at 4.25% to 4.50%.
That decision frustrated Trump, who has repeatedly called for sharp cuts to borrowing costs, arguing they’re needed to spur growth and ease the federal government’s debt load.
Posting on Truth Social, Trump went straight for Powell, calling him “stubborn” and “MORON.”
Donald Trump said:
If Powell doesn’t ‘substantially’ lower rates, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!
The comments marked a fresh escalation in Trump’s long-running feud with the Fed chair, whom he appointed and signaled rising political heat as the central bank tries to balance inflation risks with a slowing economy.
Monetary dissent hits the Fed
Donald Trump’s latest attack on Powell came as the cracks are appearing inside the Fed itself.
For the first time in over 30 years, two governors, Christopher Waller and Michelle Bowman, broke with Powell and voted for a quarter-point cut at the last policy meeting.
They cited signs of weakness in the labor market. And they downplayed recent inflation, calling it mostly the result of one-off factors.
Powell disagrees. He’s called for patience, warning that moving too soon could undo progress on inflation and force the Fed to reverse course later.
He’s also made clear he’s not ready to commit to any rate cuts at upcoming meetings. “We’re still in the early days. There’s more work to do.”
Trump rejects the Fed’s inflation data, asserting that inflation is “virtually nonexistent,” although the Fed’s preferred inflation gauge currently runs slightly above its 2% target at 2.6% annually.
The former president has pushed for a dramatic 3 percentage point cut, which economists warn could risk higher inflation by injecting excessive liquidity into the economy.
The dispute has legal and political dimensions as well.
A US Supreme Court ruling in May stymied efforts to remove Powell over policy disagreements, though the Trump administration has explored possible grounds for dismissal “for cause,” citing cost overruns in a $2.5 billion Fed renovation project.
Powell’s current term as Fed Chair expires in May 2026, after which Trump would have the authority to nominate a successor pending Senate confirmation.
Economists side with Powell
Despite Trump’s vocal opposition, notable figures in the financial sector, including JPMorgan Chase CEO Jamie Dimon, have expressed support for Powell’s independence and cautious approach.
Dimon emphasized that political interference could backfire and that the Fed’s careful stance might ultimately keep interest rates lower over the longer term.
Friday’s disappointing US jobs report, showing an unexpectedly slow job growth of 73,000 in July and downward revisions for May and June, intensified calls from Trump and some Fed governors for rate cuts to stimulate the economy.
However, the Fed’s hawkish tone after its recent meeting suggests rate reductions may remain on hold until there is clearer evidence on inflation trends and the economic impact of tariffs.
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