Trump attacks Fed boss Powell: Hohlkopf or clever head?

Trump attacks Fed boss Powell: Hohlkopf or clever head?

Washington, D.C., USA - The US President Donald Trump has once again practiced sharp criticism of Fed boss Jerome Powell. At an event in the White House, Trump described Powell as a "hollow head" and thus expressed his dissatisfaction with the current monetary policy of the US Federal Reserve. Trump even threatened to take forced measures to take interest on interest. He emphasized that an increase in the key interest rate was only justified if the inflation rate actually increases, which is currently not the case [ Oe24 ].

Next Wednesday is the next interest decision of the Fed. However, analysts do not expect interest reduction at this meeting. The FED had already set a waiting attitude due to Trump's customs policy. Trump is considered an advocate of a low interest rate policy to promote economic growth and criticized Powell orally and on social media, including Truth Social href = "https://www.tagesschau.de/weltwirtschaft/trump-fed-streit-notenbank-zinsen-100.html"> Tagesschau ].

tensions between Trump and Powell

The tensions between Trump and Powell are not new. Trump had previously referred to Powell as a "fool" and "enemy" and repeatedly accused him of slowing growth through interest rate increases. Trump's anger is particularly pronounced because the Fed did not reduce the interest at its last session and continued an interest break that started in January. The current key interest rate is between 4.25 % and 4.5 %, which is the highest level during Trump's first term [ Tagesschau ].

Trump nominated Powell for his first term, but no longer sees him as a suitable candidate for a possible re -election. Joe Biden then nominated Powell for a second term that will continue until 2026. Trump has made it clear that he will not nominate Powell again [ OE24 ].

economic uncertainties and inflation

The tense situation is also reinforced by the economic uncertainties that the current US economic policy under Trump brings. Trump's introduction of tariffs against Europe and China from April 2025 could boost inflation in the United States. Higher tariffs are considered than a turbocharger for potential loss of purchasing power from consumers and an inhibition of economic growth [ dz bank research blog ].

The Fed expects an average inflation rate of 2.7 % this year, which represents an increase compared to the previous forecast of 2.5 %. The Fed blames Trump's customs policy for her reserved interest rate policy and, in view of the economic uncertainties and inflation, has classified its monetary policy measures as restrictive [ Tagesschau ]. In summary, a complex image arises from personal conflicts and economic challenges. Trump sees Powell as an obstacle on the way to faster economic growth, while Powell is trying to control inflation and ensure economic stability. The next decision of the FED is eagerly awaited and could have far-reaching consequences for the US economy.