Trump Demands 3% Rate Cut After Fed Hike, Warns of Further Increases

Former President Donald Trump called on the Federal Reserve to slash rates by 3% after the central bank raised its benchmark rate to 3.75%-4%, marking the first increase since 2023. The Federal Open Market Committee (FOMC) unanimously voted to raise rates, with 16 of 18 members now forecasting further hikes before year-end—a shift from July's projections.

The Fed removed language blaming supply shocks for inflation and claimed this move would accelerate achieving its 2% target. Trump voiced his dissatisfaction on Truth Social hours after the decision, arguing the U.S. deserves near-zero borrowing costs due to its strong credit rating. He also claimed halting trade with surplus nations could add $150 billion annually to federal revenue—a claim fact-checkers have labeled exaggerated.

Trump has previously threatened to cut trade with surplus countries if the Fed resists policy easing, a move that would impact most major U.S. trading partners. White House Press Secretary Karoline Leavitt told Fox News Trump still 'definitely' believes in the Fed's independence, though he continues publicly pressuring the central bank.

Bitcoin prices saw a minor post-decision uptick but ended the day lower, while gold surged then retreated similarly. Traders have already priced in one more rate hike this year, with the next Powell-led meeting expected to determine if Trump's pressure intensifies.