Trump backs Warsh, slams 'political' Fed board, demands lowest rates
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- Trump backed Kevin Warsh as "fantastic" but criticized other Fed Board members as "very political" and having "bad intentions" for resisting rate cuts, speaking to reporters aboard Air Force One.
- Trump claimed the U.S. "could be at 8%, 9%, 10%, 12%" annualized GDP growth if rates were lowered, asserting the country "should have the lowest interest rate in the world, like it used to be 30 years ago."
- The FOMC is set to release its interest rate decision in two days, with markets pricing in a strong likelihood rates stay at 3.5%-3.75%, though CME's FedWatch tool shows about a 1-in-3 chance of a quarter-point hike.
- Dallas Fed President Lorie Logan, a voting FOMC member this year, called for tighter policy, saying benchmark rates should be "modestly higher" amid concerns about persistently high inflation.
- The Fed's current 3.5%-3.75% rate essentially matches the Bank of England, but sits above the European Central Bank (2.25%), Japan (1%), and China (3%).
Why it matters: Trump is publicly framing Fed dissent as a motive problem rather than a policy disagreement, days before the FOMC votes. With Logan explicitly pushing for tighter policy and markets pricing in roughly even odds between a hold and a hike, the president's pressure campaign collides with at least one voting member's stated preference for higher rates.
