President Donald Trump is renewing his old attacks on the Federal Reserve and its chair, Jerome Powell, after the independent body voted to hold interest rates steady in its first rate decision of the year.
“Because Jay Powell and the Fed failed to stop the problem they created with Inflation, I will do it,” Trump wrote on his Truth Social, by slashing regulations, pushing for more energy production, “rebalancing international trade,” and growing domestic manufacturing.
“If the Fed had spent less time on [diversity, equity, and inclusion], gender ideology, ‘green’ energy, and fake climate change, Inflation would never have been a problem,” Trump added. “Instead, we suffered from the worst Inflation in the History of our Country!”
The outcry from Trump comes a week after he told a crowd of business leaders and foreign heads of state that he would demand an immediate drop in interest rates. He also called for other nations to follow the U.S.’ lead in doing so.
However, Powell on Wednesday said that the central bank would need to see “real progress” on inflation or weakness in the labor market before making adjustments. After three straight meetings that resulted in cuts, the Federal Open Market Committee (FOMC) decided to keep the benchmark federal funds rate at 4.25%-4.50%.
Powell, who told reporters that he has had “no contact” with Trump over the last few days, noted that, “We do not need to be in a hurry to adjust our policy stance. Instead, the Fed will stick to its commitment to achieve a 2% inflation rate; according to the Bureau of Labor Statistics, the annual inflation rate is currently 2.9%.
Trump, who cited diversity initiatives as a reason the Fed had “failed,” last week signed an executive order” terminating jobs involved with DEI efforts. Around the time of that order, the Fed — which has had issues diversifying its workforce — also scrubbed a “Diversity and Inclusion” section from its website, Reuters reported.
Powell, who Trump nominated to lead the Fed’s board of governors, has been a proponent of diversity efforts. In 2021, while speaking at a conference sponsored in part by the Fed, Powell said the “best and most successful organizations are often” those who strongly committ to diversity and inclusion.
“We are working to foster an inclusive workplace environment where staff can feel comfortable at work and to promote a similarly inclusive culture within the profession,” he added at that conference.
Trump’s attacks on Powell are not without precedent.
In March 2020, Trump told reporters that he had the “right to remove” Powell and criticized his “bad decisions. In October, however, Trump said that the president should not “be allowed to order” the Fed’s interest rate decisions, adding as a caveat that he should be allowed to comment on them.
“You show up to the office once a month, and you say, ‘Let’s flip a coin,’ and everybody talks about you like you’re a God,” Trump said at an October event hosted by the Economic Club of Chicago, criticizing Powell.