Trump Pressures Fed for Major Rate Cut—Says High Interest Is 'Killing' U.S. Economy

WASHINGTON, D.C. — President Donald Trump on Tuesday called for a steep reduction in U.S. interest rates, saying the Federal Reserve should lower them by two to three percentage points immediately. He argued that current rate levels are placing an unnecessary burden on the federal government and holding back economic growth.

Posting directly on Truth Social, President Trump wrote:

We should be at least two to three points lower. If things later change to the negative, increase the Rate.

— President Donald Trump, posted on Truth Social

Trump’s remarks come at a time when the Fed has held its benchmark rate above 4% for several months, despite easing inflation data and growing calls from within financial and political circles for a shift in policy. The president, who has frequently criticized the Fed's approach to interest rates, made it clear he believes the central bank is hurting the U.S. economy by delaying cuts.

“We’re paying hundreds of billions of dollars a year in interest alone,” Trump said during a closed-door budget meeting earlier this week, according to a senior White House official. “This country should not be financing debt at rates that make no sense given what’s happening globally.”

Trump pointed to recent rate cuts by central banks in Europe, Canada, and China, insisting that the U.S. is lagging behind and missing an opportunity to reduce the cost of its record-high national debt. The federal government now pays more on interest than it spends on most departments, including defense and education.

The president also took aim at Fed Chair Jerome Powell, whom he reappointed in 2022. While not mentioning Powell by name on Tuesday, Trump has in recent weeks expressed frustration with what he sees as the Fed’s overly cautious stance.

“They’re waiting for a crisis before they act,” he told a group of conservative lawmakers on Capitol Hill last week. “We’re the United States—we should be leading on monetary policy, not reacting.”

Inside the Federal Reserve, opinion remains divided. Some members of the Federal Open Market Committee have acknowledged signs of cooling inflation and weakening job growth, signaling that a rate cut could be on the table for the July meeting. But Powell and others remain reluctant to move too quickly, concerned that premature cuts could reignite inflation and undermine the Fed’s credibility.

Trump’s statement adds further political weight to the ongoing debate. Unlike previous administrations, where public comments on Fed policy were rare, Trump has made monetary policy a regular topic in his public messaging.

Market analysts say Trump's latest comments are likely aimed not just at the Fed, but also at voters, as he looks to position his economic stewardship as proactive ahead of the 2026 midterms.

While the Fed operates independently by law, President Trump's public remarks are clearly aimed at influencing its next move—raising eyebrows inside and outside Washington.

Also Read: Fed Chair Powell Faces Political Heat as Trump Blames Fed for Slowing Economy