Trump’s tariffs put the Fed in a tough spot on interest rates and inflation
NBC1 day
Trump Calls Powell a 'Fool' After Fed Keeps Rate Unchanged
Above: Jerome Powell, chairman of the U.S. Federal Reserve, during a news conference following a Federal Open Market Committee (FOMC) meeting in Washington, D.C. on May 7, 2025. Image copyright: Tierney L. Cross/Contributor/Bloomberg via Getty Images
The Spin
Pro-Trump narrative
Trump is justified in his frustration with Powell, whose excessive money printing enabled Biden's uncontrolled spending, which is the real cause of the worst inflation, not tariffs. Powell ignored the money supply (cash, checking, and savings), focusing on irrelevant metrics and DEI — enriching the wealthy through rising asset prices while hurting the middle class. Trump's spending cuts target the cause of inflation, while Powell's failures and legal breaches warrant his dismissal.
Anti-Trump narrative
Powell's steady hand at the Fed is justified, as Trump's tariffs, not government spending, threaten inflation and stagflation. Tariffs raise prices and slow growth, risking jobs and higher costs. Powell's cautious approach avoids premature cuts that could spike inflation further. Trump's attacks on Powell are not only inappropriate but also ignore the Fed's data-driven strategy — to balance employment and prices amid tariff-induced uncertainty.