The Federal Reserve’s decision on interest rates is just hours away, and there’s already conflict in politics. On the South Lawn of the White House today, U.S. President Donald Trump called Fed Chair Jerome Powell “Stupid”. He said the central bank “probably won’t cut today.”
He said the Fed has kept borrowing costs too high for too long, and that this is costing the U.S. economy billions of dollars. “He’s a political guy who’s not a smart person, but he’s costing the country a fortune,” Trump said.
Trump went on to say that the current interest rates should be at least two percentage points lower. He pointed out that while Europe has already made multiple rate cuts, the U.S. has done nothing.
The Fed currently holds interest rates in the range of 4.25% to 4.50%. Most experts believe that the Fed will not make any changes during today’s meeting. According to CME FedWatch tool data, there is a 99.9% chance that rates will stay the same. Investors are more interested in what the Fed might signal about possible rate cuts later this year.
Trump also commented on inflation. He said he understands Powell’s concerns but doesn’t believe inflation is a threat right now. “If he’s worried about inflation, that’s OK. I understand that. I don’t think there’s going to be any. So far, there hasn’t,” Trump said.
“But now we have a man that just refuses to lower the Fed rate, just refuses to do and he’s not a smart person. I don’t even think he’s that political. I think he hates me, but that’s OK.” the President said.
Meanwhile, Bitcoin is holding steady. It seems the market is waiting to make a move. It dipped below $104,000 yesterday, tried to recover to around $105,000 today, but dropped back. Right now, Bitcoin is trading for $104,873.
Any decision from the Fed could swing Bitcoin either way. If Powell sounds tough on inflation, Bitcoin could drop below $100,000. But if the Fed hints at future cuts, Bitcoin might shoot past $110,000.
Trump also joked about taking Powell’s job. “I’d do a much better job than these people,” he said. Though he doesn’t plan to fire Powell, he hinted that he may name a new Fed Chair once Powell’s term ends in May next year.
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