Overview

• President Trump publicly criticized Federal Reserve Chair Jerome Powell, stating he knows more about interest rates and urging rate cuts to combat economic slowdown.
• The U.S. economy contracted by 0.3% in Q1 2025, marking its worst performance in three years, as businesses adjusted to ongoing tariffs.
• Trump's earlier social media attacks on Powell, including calling him a 'major loser,' triggered market declines but were followed by reassurances that he would not fire Powell.
• Senior administration officials have cautioned against further market disruptions, advocating restraint in the ongoing tension between the White House and the Federal Reserve.
• The Federal Reserve has maintained its cautious stance on interest rates, citing inflation concerns and the economic risks posed by trade policies and tariffs.