Summary
- President Trump's tariff policy was revealed to have an increasing possibility of stimulating price increases.
- Chairman Jerome Powell responded to demands for interest rate cuts by stating he would make independent decisions based on economic conditions.
- Chairman Powell indicated that President Trump's tariff policy is becoming a burden for him.
Trump Pressures "Interest Rates Should Be Lowered"
Donald Trump administration's tariff policies are increasingly likely to stimulate inflation, and President Trump's public pressure to lower interest rates is making policy decisions difficult for Federal Reserve (Fed) Chairman Jerome Powell.
On the 12th (local time), Chairman Powell appeared before the House Financial Services Committee and stated, "You can be confident that we will make decisions based on economic conditions." This was his response when asked about President Trump's demand through Truth Social that "interest rates should be lowered." Powell emphasized that "some degree of (central bank) independence is very important in controlling inflation." This is interpreted as an indirect criticism of President Trump's demands for interest rate cuts.
President Trump's tariff policy is also becoming a burden for Chairman Powell. When asked about the impact of tariffs on prices during the hearing, Powell was reserved, saying "it's not the Fed's job to evaluate tariffs."
Reporter Kim In-yeop inside@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
