Trump cites cooling inflation, strong jobs to push Fed’s Powell for rate cuts before July 30-31 meeting, despite Powell’s tariff-driven caution.
President Donald Trump has advocated for interest rate reductions in anticipation of the Federal Reserve’s July meeting. The US president contended that reduced interest rates would precipitate a housing market growth; however, the likelihood of a rate cut remains low.
Trump urges Powell to reduce interest rates
Donald Trump, the president of the United States, demanded interest rate reductions before the Federal Reserve’s meeting today. His most recent endeavor is contingent upon additional economic data. Trump contended in a Truth Social post that a positive GDP report, which suggests a 3% growth in Q2, is just one of many factors for rate cuts.
The most recent Q2 GDP figures exceeded the anticipated 2.3% estimate, as data from the US Bureau of Economic Analysis (BEA) indicated. In conjunction with declining inflation metrics, Trump implored Fed Chair Jerome Powell to lower rates, branding him “Too Late” for failing to do so after several Fed meetings in 2025.
Trump believed that decreasing the interest rate would enhance the housing market’s activity levels, enabling residents to refinance their existing mortgages and purchase properties. To digitize the sector, Senator Cynthia Lummis recently introduced the Mortgage Act, which recognizes Bitcoin in loan eligibility procedures.
Five days after his Federal Reserve visit, the United States President issued his most recent appeal for interest rate reductions. Trump advocated for rate reductions during his visit to the Federal Reserve, referencing the European Central Bank’s history of interest rate reductions and the low inflation rate in the United States.
Rate Cuts Probability Declines Before Federal Reserve Meeting
The US economic outlook for the next seven weeks could be significantly influenced by Trump’s call for a rate reduction scheduled just hours before the July FOMC meeting. The CME FedWatch tool estimates the likelihood of the Federal Reserve reducing interest rates by 400 -425 basis points to 3.1% before the FOMC meeting.
At the same time, the probability of the Federal Reserve maintaining interest rates at 425–450 basis points has reached a record high of 96% in response to demands for rate reductions. A report observed that the Federal Reserve is on the brink of a rare divide, as two Governors appointed by President Trump may advocate for immediate interest rate reductions, despite the low odds. Nevertheless, Treasury Secretary Scott Bessent said he did not anticipate the Federal Reserve reducing interest rates.
Mary Daly, the President of the San Francisco Federal Reserve, has previously advocated for two rate declines in 2025. Daly suggested that the Federal Reserve should maintain stable interest rates before relaxing the interest rate reduction in subsequent meetings.