Trump demands 1% or lower interest rate after first Fed hike since 2023 — SkimNews
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- Trump demanded the Federal Reserve slash interest rates to 1% "or less" in a Wednesday Truth Social post, hours after the central bank announced its first rate hike since 2023, writing: "LOWER THE INTEREST RATES FOR THE UNITED STATES OF AMERICA, AND FAST!"
- The Federal Reserve, led by Trump-picked Chairman Kevin Warsh, unanimously raised benchmark interest rates by a quarter percentage point to a target range of 3.75%-4%, with the 12-member FOMC stating that "inflation remains elevated."
- Trump claimed the U.S. has "raked in as much as $20 trillion or more during his second term" and that halting trade with deficit countries would generate "at least, 1.5 Trillion Dollars a year"—figures the article notes fact-checkers have called false.
- Less than two weeks before the hike, Trump threatened to cut off trade with countries that run trade surpluses with the U.S.—a group that includes most of America's top trading partners—if the Fed doesn't cut rates.
- Trump and his aides have refrained from personally attacking Warsh; White House spokesman Kush Desai told Fox News that Trump "absolutely" still believes in Fed independence but retains a "First Amendment right" to speak out "when things go awry."
Why it matters: The Fed hiked a quarter point to 3.75%-4% in a unanimous vote while the president publicly demanded a 75-point cut in the opposite direction, re-escalating a pressure campaign that had briefly quieted under Warsh. Trump is simultaneously floating trade retaliation against surplus countries—most major U.S. partners—as leverage, leaving Fed independence nominally intact but the confrontation fully reignited.
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