The Federal Reserve will not decrease rates like Trump because it sees a “meaningful” inflation over this year later this year

So far this year, the Federal Reserve has not touched interest rates, while maintaining its target rate at its current level ranges between 4.25 % and 4.5 %, as it was since July 2023.

The decision to stop discounts in prices obtained Powell President Donald Trump angered. Since regaining the office, Trump often student Powell is less than interest rates. In a post on social media on Tuesday, before Powell’s certificate in Congress, Trump said he believed that interest rates should be “points to three points less than their current levels.

“I hope Congress will really work this very stupid person, who ended up,” Trump wrote. “We will pay the price of his incompetence for many years to come.”

During Powell’s testimony before the House of Representatives Financial Services Committee on Tuesday, members of Congress – most of them democrats – the Federal Reserve Speaker asked for his view of his statements and Trump’s policies, especially in trade and immigration. Powell refused to comment every time, saying it was “inappropriate” for the Central Bank to comment on the decisions of the elected officials.

Powell reported that the Federal Reserve wants to wait for a price reduction until the future of the economy becomes more clear.

“The rates depend on the path of the economy, and this is very uncertain,” said Powell.

Economic uncertainty increased in all fields in the wake of Trump tariff policyWhich raised the global markets. The stock markets have mostly recovered from April when they were hole On fears, global trade will be disrupted. During this period of turmoil, Powell referred to the fact that basic data, such as inflation and unemployment, was strong. Powell, he gave this federal reserve time to wait before making a decision.

Powell said that the main question remains “timing, quantity and perseverance”, that is, an increase that may arise from Trump’s identification policy. Expecting is that the definitions will definitely rise once in the prices that settled after that. Fear is that this does not happen and the prices are still high, or even continue to increase.

Although the customs tariff that was implemented in April, Powell said it does not expect its effects – however, it may not be known – to start hitting companies and consumers until the summer. Most of the importers had already been stored before the tariff policy, but with these stocks diminished, they would have to start buying the imposed goods.

“I think we haven’t expected this yet,” said Powell. “We are now starting to believe that it is time to see it (the effects). If we don’t see it, it will be important. If we see it, this is important. So we just followed a cautious approach to not reducing our policy rate until we have more confidence in size and the effects of that.”

He made Powell’s approach to wait and look at the White House. The president, unprecedented for political standards, challenged traditions through active views on monetary policy, and is usually allocated exclusively to the non -political Federal Reserve. Sometimes, Trump thought of shooting Powell. Once he floats on the possibility of appointing itself as the Federal Reserve Carre.

Supporters of reducing interest rates immediately believe that it will help stimulate the economy and compensate for a decrease in expected growth after the customs tariff has put brake on commercial investment. After the last consumer price index a report Earlier this month, the prices that rose by only 0.1 % showed that the Vice President JD Vance joined Trump to summon Powell.

“The president used to say this for a while, but it is more clear: The Federal Reserve to reduce prices is the cash misconduct,” books on x.

An unidentified group of individual expectations of Federal Reserve officials, which was issued last week, showed that the average expectations were For price discounts By the end of the year.