President Donald Trump attacked Federal Reserve Chair Jerome Powell yet again on Thursday morning, a day after the central bank announced it would hold interest rates steady. Trump had been campaigning for Powell to lower them.
Trump wrote on his Truth Social site, “‘Too Late’ Jerome Powell is a FOOL, who doesn’t have a clue. Other than that, I like him very much!”
While inflation has cooled from its 2022 highs, the Fed said in its report Wednesday that recent data hadn’t provided sufficient assurance to begin reducing rates once again. But the central bank’s message was a little different this time around, and Powell warned of the rising risks of both higher unemployment and inflation, raising the possibility of a stagflationary scenario.
This was the Fed’s third hold in a row, following pauses during meetings in March and January. The central bank cut interest rates three times in the later half of 2024.
The Fed’s decision came against a backdrop of slowing economic growth and still-sticky inflation. The U.S. economy contracted by 0.3% in the first quarter of 2025, while the labor market added 177,000 jobs in April — a figure that only modestly exceeded expectations.
Core inflation, measured by the Fed’s preferred metric, the Personal Consumption Expenditures price index, continues to hover above the 2% target, reinforcing the Fed’s cautious stance.
“The economy itself is in solid shape,” Powell said. Though, he added, to some laughs from reporters, that “my gut tells me that uncertainty about the path of the economy is extremely elevated.”
The president’s tariffs were the talk of Washington when Powell spoke to reporters Wednesday. While the Fed doesn’t directly weigh in on or set fiscal or trade policy, such developments will affect inflation dynamics going forward — and further complicate the its task.
Powell addressed tariffs in his press conference, saying the central bank will continue to “wait and see and watch” as the tariff policies change over the coming weeks and months. He said the Fed was comfortable in its policy stance and can move quickly when appropriate.
Now, he said, “It remains to be seen how these developments may affect future spending and investment.” Powell noted, however, that if the current tariffs are sustained, they would affect inflation, economic growth, and employment levels. But “the effects on inflation could be short lived, reflecting a one-time shift in the price level.”
In that same social media post, Trump railed against any negative assessment of the economy he’s now responsible for, writing, “Oil and Energy way down, almost all costs (groceries and “eggs”) down, virtually NO INFLATION, Tariff Money Pouring Into the U.S. — THE EXACT OPPOSITE OF ‘TOO LATE!’ ENJOY!”
This isn’t the first time Trump has expressed — extreme — displeasure with the central bank chief. The president has called Powell a “major loser” and a “total stiff” and floated the idea of trying to fire the central bank chief — before walking that idea back.
Powell said Wednesday that Trump’s comments don’t affect his or the Fed’s job:
“We’re always going to do the same thing, which is we’re going to use our tools to foster maximum employment and price stability for the benefit of the American people. We’re always going to consider only the economic data, the outlook, the balance of risks. And that’s it. That’s all we’re going to consider.
“So it really doesn’t affect either our job or the way we do it.”