U.S. President Donald Trump has consistently pushed for lower interest rates, even criticizing the Federal Reserve publicly over the matter.
However, his own unpredictable trade policies have complicated the Fed’s ability to act on this request.
The Fed has acknowledged its reluctance to act citing uncertainty about the future impact of tariffs.
Concerns over Trump’s tariffs has increased inflation expectations, though current data shows inflation cooling in March.
Additionally, the economy remains resilient, as seen in the strong April jobs report. Cutting rates in a robust economy could lead to inflation, contradicting the Fed’s mandate.
While economic growth may slow eventually due to tariff uncertainties, the data so far does not support rate cuts.
