Rising Inflation: Trump Accuses The Fed Of Slowing Down The Economy

In a financially fragile America, Donald Trump aspires to radical changes. To achieve this, he meticulously chooses his allies for the coming years. However, some institutions, such as the Federal Reserve (Fed), are reluctant to bend to his ambitions. Between monetary independence and presidential pressures, the relationship between Trump and Jerome Powell, the current head of the Fed, promises to be tumultuous.  

Donald Trump vs. the Fed: Standoff and Ambitions  

Donald Trump, the man who wants to save America through Bitcoin, has always had an obsession: to maintain a tight grip on the levers of the American economy. And for him, the Fed is a key player he cannot ignore. Since his first term, he has openly criticized the monetary policy led by Jerome Powell, whom he had appointed to head the institution in 2018.  

The former president accuses the central bank of not following his guidelines, particularly regarding interest rate cuts, a tool he sees as essential for supporting growth and financial markets. In response, Powell has fiercely defended the independence of the Fed, reminding that its decisions are based on economic analyses and not on political priorities.  

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This tension reached its peak when Trump mentioned the possibility of firing Powell, a legally questionable initiative. Despite this, the former president persists: “The president should have a say.” 

For Powell, the response is clear: “Our decisions are independent and will not be dictated by anyone.”  

The American Economy Under the Fed’s Microscope 

Despite Trump’s criticisms, Jerome Powell made sure to praise the resilience of the American economy. With a historically low unemployment rate of 4.1% and robust growth, the United States continues to stand out among the major economic powers. However, challenges remain numerous.  

Economic report under Powell:  

• GDP growth: twice as fast as that of the Eurozone;  
• Inflation: declining, but still above the 2% target;  
• Labor market: inflationary pressures easing due to slight stabilization;  
• Key interest rates: adjusted cautiously, currently between 4.50% and 4.75%.  

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For Powell, maintaining a balance is crucial: stimulating growth without reigniting the flames of inflation. However, Trump sees these choices as unnecessary obstacles to his economic ambitions. The Fed, on its part, remains inflexible in its mission to ensure financial stability, regardless of political pressures.  

Inflation and Political Tensions: An Explosive Cocktail 

Inflation is one of the key nerves of the economic war. Under Powell, the Fed has committed to gradually reducing this phenomenon, but the results are slow to convince everyone, starting with Trump. In October, inflation rebounded to 2.6%, provoking new criticisms from the former president and concerns.  

Trump believes that more aggressive rate cuts could prevent unnecessary tensions in the markets. However, Powell remains cautious: “A bumpy trajectory is to be expected.” 

Political pressures do not help. Trump wants quick actions to appeal to Wall Street and support his presidential ambitions.  

But beyond the numbers, it is the very philosophy of economic management that opposes the two men. For Powell, stability takes precedence over flashy moves. For Trump, the short term prevails, even at the cost of ignoring the warning signals sent by economists.  

In the event of a return to the White House, Donald Trump does not hide his intention to fire Gary Gensler, head of the SEC, and to continue his standoff with Powell. The latter, solid in his supports, might consider leaving his post to avoid a renewed open war. The future promises to be as unpredictable as Trump’s politics.