President Donald Trump urged the Federal Reserve Board to "take control" if Chairman Jerome Powell doesn't cut interest rates, escalating his feud with the central bank's leadership.

"Jerome Powell 'Late,' a stubborn, STUPID man, must lower interest rates substantially, now. if he continues to refuse, the board must take control, and do what everyone knows should do!" the president wrote on social media on Friday.

The White House did not immediately respond to a request for comment on the president's remarks.

Trump's post came after Fed officials left interest rates unchanged on Wednesday. In a post-meeting press conference, Powell gave no clear indication that policymakers were likely to cut rates at their next meeting, in September. Investors are now anticipating only one rate cut by the end of the year.

Interest rate decisions are made by the Federal Open Market Committee (FOMC), which Powell chairs. Its constituents include the seven members of the Fed's Board of Governors in Washington and the presidents of the five regional Fed banks. The FOMC elects its chairman and vice chairman once a year.

Following Wednesday's decision, Trump resumed his sharp criticism of Powell after a brief detente, slamming the central bank chief for his interest-rate policy and the renovation of Fed headquarters, which critics have accused of mismanagement. Trump had asked lawmakers whether he should fire Powell, then told reporters he had no intention of doing so, indicating he was willing to wait until the central bank chief's term as chairman ends in May.

Bessent's Comments

Treasury Secretary Scott Bessent said Thursday that he hoped Trump could announce Powell's replacement by the end of the year. "We're putting together a very good list of candidates," he told CNBC. "I expect the announcement will be made by the end of the year."

Bessent also highlighted the presence of dissenting voices in Wednesday's decision and two potential vacancies on the Fed board early next year, suggesting the Fed could soon have a "majority" supporting a rate cut. Governor Adriana Kugler's position opens in January, and Powell's position on the board would be his second if he decides to leave the central bank entirely after his term as chairman ends.

Two Fed governors, Christopher Waller and Michelle Bowman, voted against the decision, the first time two board members have dissented since 1993.

Powell tends to believe the Fed is in a good position for now, given the lingering uncertainty surrounding the economic impact of Trump's tariffs. His message on Wednesday was balanced, tempering expectations for a September rate cut but not ruling out the possibility. (alg)

Source: Bloomberg