Trump Pressures for Rate Cuts Again... Powell Dismisses, Saying "We Will Do Our Job"

Trump Again Says "Rates Should Be Cut" on Social Media
Powell: "We Have Not Reached Inflation Target... Restrictive Policy to Continue"

Jerome Powell, Chair of the U.S. Federal Reserve (Fed), stated that President Donald Trump's calls for interest rate cuts will not alter the central bank's monetary policy.

On the 12th (local time), appearing before the House Financial Services Committee, Powell responded to lawmakers' questions about President Trump's pressure to lower rates by saying, "People can be confident that we will keep our heads down, do our jobs, and make decisions based on what is happening in the economy."

By emphasizing the independence of monetary policy in the face of President Trump's demands for rate cuts, Powell drew a clear line. Earlier that morning, President Trump once again pressured the Fed by posting on his self-created social networking service, Truth Social, "Rates should be cut. This should happen alongside upcoming tariffs."

In the markets, as the Consumer Price Index (CPI) for the previous month was announced to have risen 3% year-on-year, exceeding expectations, there is growing sentiment that the Fed will further delay the pace of interest rate cuts.

Regarding the inflation situation, Powell said, "We are close to our inflation target, but we have not reached it yet," adding, "Today's inflation data tell the same story." He emphasized, "We will maintain a restrictive monetary policy stance for the time being." This marks the second consecutive day that Powell has signaled a cautious approach to monetary easing.

Some on Wall Street are now analyzing that the Fed's monetary easing cycle has come to an end.

Josh Jamner, investment strategy analyst at ClearBridge Investments, said, "The Fed said, 'Let's wait and see,' but the hot January CPI report means they'll have to wait even longer," adding, "This report hammered the final nail in the rate cut cycle. The rate-cutting cycle is over."