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Trump Escalates Conflict with Federal Reserve Chair Over Interest Rate Cuts

 © Bloomberg

Key Takeaways

  • President Donald Trump has intensified his criticism of Federal Reserve Chair Jay Powell, threatening removal and demanding faster interest rate cuts.
  • Powell warned that Trump's tariffs would lead to slower economic growth and higher inflation, creating tension between the Fed's dual mandates.
  • The Fed has kept rates on hold in 2025 after three consecutive cuts in 2024, signaling no immediate plans for further reductions.
  • Powell has defended the Fed's independence, stating the central bank will not be influenced by political pressure.
  • International central banking leaders, including ECB President Christine Lagarde, have expressed support for Powell and central bank independence.

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