- Donald Trump has called for immediate interest rate cuts, criticizing Fed Chair Jerome Powell.
- This comes ahead of Powell’s congressional testimony.
- The crypto community sees Trump’s comments as a bullish signal, with expectations rising for looser monetary policy.
President Donald Trump has publicly intensified his criticism of the Federal Reserve, demanding immediate interest rate cuts in a social media post published just ahead of Fed Chair Jerome Powell’s semiannual testimony before Congress this week.
The direct political pressure has reignited optimism in the crypto market, which views lower interest rates as a bullish catalyst.
Trump Calls for ‘Two to Three Point’ Rate Cut
In his post on Truth Social, Trump criticized the central bank for not lowering rates despite what he described as favorable economic conditions. Trump accused the Fed of failing to look into the favorable economic conditions, noting that Europe has already implemented ten rate cuts, while the U.S. has seen none.
“No inflation, great economy. We should be at least two to three points lower,” Trump wrote.
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As of the latest Federal Open Market Committee (FOMC) statement on June 19, the federal funds rate stands at 4.25%–4.5%. Trump argued that lowering rates could save the U.S. economy $800 billion annually by reducing borrowing costs, making debt cheaper to service, and stimulating growth.
He also urged the Fed Board to act quickly and warned that the U.S. would be “paying for Powell’s incompetence for years to come.”
Markets Eye Congressional Pressure on the Fed
Trump’s remarks come just as Powell prepares to face questioning from lawmakers. With inflation easing and labor market pressures subsiding, investors are watching closely for indications of a policy shift.
Trump’s renewed pressure may intensify political scrutiny on the Fed, potentially accelerating the timeline for rate adjustments. He has repeatedly criticized the central bank, although his calls for rate cuts have largely gone unheeded.
Following the June FOMC meeting, Powell cited a strong labor market and near-term inflation expectations as reasons to hold rates steady. He attributed some inflationary pressure to tariffs imposed by the Trump administration, which he argued limit the Fed’s policy flexibility.
While inflation has retreated from its 2023 peak, it remains above the Fed’s 2% target. Powell reiterated the central bank’s commitment to maintaining current rates while continuing to assess economic risks. However, he acknowledged that future cuts are possible if inflation trends lower.
Crypto Community Sees Bullish Signal
Trump’s renewed push for rate cuts has reignited optimism in the crypto space. Analyst Ash Crypto responded to the president’s comments, suggesting a rate cut may come sooner than expected.
Historically, falling interest rates have been bullish for Bitcoin and other cryptocurrencies, as investors often rotate into higher-risk, high-reward assets in a low-yield environment.
With Trump aggressively pushing for monetary easing, the crypto market may begin pricing in looser policy. This could spark a new wave of bullish momentum following weeks of lackluster performance.
At press time, Bitcoin is trading above $105,000 after a sharp rebound from yesterday’s dip to $98,000, which was driven by escalating conflict in the Middle East.
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