On Thursday, the American president had a tense exchange with the boss of the institution, Jerome Powell, to whom he again asked to lower the rates.
The animosity between the American president and the leader of the American central banking does not weaken. Donald Trump, who came to inspect the Fed on Thursday, had a tense exchange with the boss of the institution, Jerome Powell, to whom he asked again to lower the rates, but without going to the face-to-face as he has done by social networks and cameras interposed in recent weeks, repeatedly.
The 79 -year -old Republican came to observe a major renovation project for the imposing building in Washington. The central banker challenged, vigorously shaking his head, costing the cost of work of $ 3.1 billion advanced by the American president, instead of 2.7 billion at the start. “I am not aware”he said. Loking his glasses and examining a paper that Donald Trump stretched to him in front of the journalists, Jerome Powell stressed that the republican had added to his estimate “Third building”. “It is a building that is under construction”launched the president, wearing like his host of a site helmet. “No, it was built five years ago”retorted the boss of the Fed.
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Donald Trump had recently considered that the renovation site could have given rise to a “fraud”fueling speculation on a referral to the boss of the federal reserve. The Republican President had appointed him during his first mandate (2017-2021), then Jerome Powell was renewed by the Democrat Joe Biden. But he ensures bitterly regret this choice and regularly overwhelms the central banker with virulent criticism.
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“Not aware”
“I would like him to lower interest rates”said the American president again by his side. A little later, during a quick press briefing, Donald Trump said he was convinced that Jerome Powell “Would do what is needed”while the next meeting of managers of the American Federal Reserve (Fed) on rates is scheduled for July 29 and 30. The Republican leader denied all «tension» during the meeting and assured that he had not done «pression» for a resignation. “He should have dropped interest rates several times”had deplored Donald Trump on Tuesday, adding: “People cannot buy a house because this guy is a nigud. He maintains too high rates and probably does it for political reasons. ”
The American central bank, an independent institution whose decisions and comments have an immense impact on the markets, has maintained stable interest rates this year. It so far pushes the idea of a drop in a context made uncertain by the world protectionist offensive by Donald Trump, who could increase prices. The FED guiding rates – which guide the loan costs for individuals and businesses – are between 4.25% and 4.50% since December. The European Central Bank, to which Donald Trump often refers, has gradually dropped its key rate, from 4% in June 2024 to 2% today.
The American president recently admitted that he was very unlikely that he will return the boss of the Fed, in an irremovable theory or almost. Such a dismissal would be unprecedented, and would require proving the existence of serious faults or embezzlement from the very weighted central banker of 72 years, whose mandate ends in May 2026.
Interest rates are the main tool of central banks to guide the economy. Lower the rates encourage activity, but can raise prices. Increasing rates helps fight inflation, but can slow growth.