President Donald Trump posted a scathing message on Wednesday after the Federal Reserve raised its benchmark rate for the first time in more than three years. In the tweet, Trump insisted that U.S. interest rates should be 1 percent or lower, arguing that the country’s creditworthiness and booming investment would allow such a rate. He further claimed that eliminating trade deficits could generate $1.5 trillion a year and urged the Fed to cut rates quickly.
The comment conflated the federal funds rate, which the Fed sets to manage inflation and employment, with the rates borrowers pay for loans, which depend on individual credit history. Trump’s claim that the United States has the “best credit in the world” is at odds with market data, as the yield on 10‑year Treasury bonds has risen above 5 percent this week.
The Fed’s decision, led by Chairman Kevin Warsh, raised the target range to 3.75‑4 percent, the first increase since 2023. The Fed’s statement emphasized that inflation remains elevated and that the policy move should help the economy return to its 2 percent goal. Projections accompanying the decision suggested one more quarter‑point hike before year‑end and none in 2027.
Trump’s post is part of a long‑running feud with the Fed. He has repeatedly demanded rate cuts, criticized Chairman Jerome Powell as a “bonehead,” and sought to influence the Fed’s board. Warsh, who was appointed by Trump, has defended his independence and said he would not cut rates simply because the president requested it.
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