Jerome Powell isn’t rushing to lower rates, even if Trump is rushing to fire him

President Donald Trump is running out of patience: He wants lower interest rates, a key part of his economic agenda. The only problem: America’s rate-setters don’t report to him.

President Donald Trump is running out of patience: He wants lower interest rates, a key part of his economic agenda. The only problem: America’s rate-setters don’t report to him. Trump over the past week has ripped into Federal Reserve Chair Jerome Powell for not lowering borrowing costs, threatening to fire him from what is an independent government agency. On Monday, Trump renewed his public pressure campaign against Powell, calling him a “major loser.” But Trump’s demands stand in stark contrast with the Fed’s data-driven approach. Not only is inflation still higher than Fed officials want, but Trump’s massive policy shifts threaten to send prices even higher. “The risks to inflation are more elevated than they were a year ago, so the consequence of that is we might have to hold policy tighter for longer than we had thought,” San Francisco Fed President Mary Daly said Friday at an event hosted by the University of California, Berkeley. The Fed, under Powell’s leadership, has so far succeeded in tamping down the fastest inflation in more than 40 years without a recession, an exceptionally rare feat known as a “soft landing.” Even Republicans such as Sen. John Kennedy of Louisiana have praised the Fed’s staunch commitment to data. In recent public speeches, several Fed officials have agreed that they can be patient before introducing a rate cut. Inflation is still above the Fed’s 2% target and the job market remains in good shape, so there isn’t a convincing case for the Fed to cut rates.