Federal Reserve Chair Powell Attributes Lack of Rate Cuts to Trump’s Policies

Jerome Powell, the Chair of the Federal Reserve, has suggested that the fiscal policies pursued by former President Donald Trump are responsible for the central bank’s inability to lower interest rates. During the most recent meeting of the Federal Open Market Committee, Powell voiced concerns about the increasing national debt resulting from tax cuts enacted under the Trump administration. He clarified that these expansionary fiscal policies led to heightened aggregate demand within the economy, contributing to elevated inflation. Powell emphasized that the Federal Reserve remains dedicated to maintaining price stability and will continue to closely monitor economic data to make informed decisions regarding monetary policy. He added that reducing interest rates at present could exacerbate inflation, potentially requiring the central bank to take more aggressive measures in the future. He noted the need for greater fiscal discipline from the government to create favorable conditions for a sustainable reduction in interest rates.