The head of the American reserve excludes the impact of Trump’s statements on interest rate decisions

Jerome Powell, head of the US Central Reserve Council, said that the US President’s calls will not push the council to change his decisions on interest rates.
“The people can trust that we will continue to focus on our work and make our decisions based on what is happening in the economy,” Powell added in his testimony before the Financial Services Committee in the House of Representatives on Wednesday.

Trump’s economic agenda

This comes after President Trump called for reducing the main interest rates with the aim of increasing pressure on the Federal Reserve, while Trump is moving to implement the economic agenda for his second mandate, especially imposing customs duties on all American imports and extending tax exemptions.

“The interest rates should be reduced, which should go alongside with the imposition of the upcoming fees,” Trump said in a post on social media platforms.
However, Powell indicated during a press conference last month that the Reserve Council, after reducing the main interest rate 3 times in late last year, will refrain from more discounts pending evidence that inflation is approaching the target level, which is 2%.

High inflation rate

Many reserve council officials want to wait and see how Trump’s policies, including the definitions he suggested and those that he put on the economy.
Most economists are afraid that customs tariffs will lead to at least a temporary high inflation.

At the same time, the inflation rate in the United States increased during the past month, in the latest indication of the continued pressure of consumer prices, against the backdrop of the high prices of groceries, gas and used cars, which will enhance the decision of the American Federal Reserve (Central Bank) to postpone the reduction of interest rates.

The high consumer price index

The consumer price index increased by 3% annually during January, according to the US Ministry of Labor data issued on Wednesday, compared to 2.9% in the previous month.
The inflation rate fell last September to 2.4%, recording its lowest level in 3 and a half years.