The Federal Reserve is poised to maintain its short-term interest rate at approximately 4.3%, resisting political pressure from President Trump and Treasury Secretary Scott Bessent to lower borrowing costs. While they argue that cooling inflation means high rates are unnecessary, the Fed is cautious due to ongoing economic factors, including Trump's tariffs. Musk has suggested closer scrutiny of the Fed's spending, indicating heightened political scrutiny of the independent agency, despite Trump's recent downplaying of inflation concerns.
Trump and Treasury Secretary Scott Bessent have publicly urged the Federal Reserve to lower rates, stating that with inflation cooling, high borrowing costs are unwarranted.
Even as Trump tones down his rhetoric about firing Powell, the Federal Reserve remains under intense political pressure, highlighting challenges to its independent status.
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