President Donald Trump has officially stated that he will not remove Jerome Powell from his position as the Federal Reserve Board chairman before Powell's term concludes in May 2026. During a recent interview on NBC News' Meet the Press with Kristen Welker, Trump described Powell as a "total stiff" and reiterated his calls for the Federal Reserve to lower interest rates. Despite his criticism, Trump emphasized that he expects the Federal Reserve will eventually take action to decrease rates.
In his interview, Trump insisted that his controversial decisions to alter the global trading system through increased tariffs would ultimately lead to wealth for Americans. He attributed the first-quarter contraction in the U.S. economy to the policies implemented by former President Joe Biden. Trump stated, "Well, he should lower them. And at some point, he will," referring to the interest rates set by the Federal Reserve.
Trump's recent remarks have raised eyebrows on Wall Street, particularly after he intensified his criticism of Powell, which led to a sharp decline in stock prices last month. His comments have contributed to fears regarding the central bank's autonomy and have caused significant fluctuations in financial markets. However, his latest statements may provide some reassurance to investors who are concerned about the ongoing trade tensions.
On April 2, Trump implemented a 10% tariff on imports from most countries, alongside higher tariffs on several trading partners, which were temporarily suspended for 90 days. He has also introduced a 25% tariff on autos, steel, and aluminum, as well as similar tariffs on Canada, Mexico, and China. These aggressive tariff strategies have resulted in heightened volatility on Wall Street, reminiscent of the market's tumultuous reactions during the early stages of the COVID-19 pandemic.
Throughout the interview, Trump continued to deliver mixed messages regarding the economy. He downplayed concerns about a decline in GDP in the first quarter, attributing any economic weaknesses to Biden's administration while claiming credit for any positive indicators. "The good parts are the Trump economy and the bad parts are the Biden economy because he's done a terrible job," he asserted.
Trump addressed worries that tariffs on China could lead to increased consumer prices by suggesting that Americans do not need an abundance of inexpensive goods. "I'm just saying they don't need to have 30 dolls," he argued, emphasizing a preference for a more streamlined selection of products. His administration is currently engaged in negotiations with over 15 countries to establish trade agreements that may mitigate the impact of higher tariffs, with the potential for an announcement of the first deal in the near future.
During the interview, Trump did not rule out the possibility of making some tariffs permanent. "No, I wouldn't do that because if somebody thought they were going to come off the table, why would they build in the United States?" he stated, highlighting the influx of trillions of dollars in investments from both foreign and domestic companies.
Trump acknowledged the tough stance he has taken with China, which has effectively curtailed trade between the two largest economies in the world. "We've gone cold turkey," he remarked, suggesting that the current lack of trade has prevented significant financial losses. He expressed optimism that China is eager to reach a fair deal, stating, "They want to make a deal very badly." As negotiations continue, the outcome of these discussions will be crucial for the future of U.S.-China trade relations.
