By AP Economics Writer Christopher Al Gerber
WASHINGTON (AP) — President Donald Trump met with Federal Reserve Chairman Jerome Powell on Thursday, and the two discussed the economy, but Powell’s outlook on interest rates, the Fed said.
Powell told Trump that the central bank will make decisions about short-term interest rates that are controlled “only based on prudent, purpose and apolitical analysis.” Typically, the Fed rate affects the overall economy’s borrowing costs, including mortgages, car loans and business borrowings.
The meeting comes because Trump attacked Powell for not cutting the Fed’s main interest rates and calling him “too late Powell.” The president has launched a meeting, the Fed said.
Trump has argued that Powell should cut interest rates because “there is no inflation,” but such a move does not necessarily reduce the borrowing costs faced by consumers. Inflation has been declining significantly over a year ago, but has surpassed the Fed’s 2% target.
The meeting is the first of Trump’s second term, but the two spent lunch together in his first term. The Fed Chair meets with Treasury secretaries regularly, but it’s less frequent with the president given that the Fed’s interest rate decisions are aimed at being separate from political concerns.
Original issue: May 29, 2025, 1:54pm
