Trump rips ‘hostile’ Fed board after rate hike but defends Warsh

President Donald Trump criticized the Federal Reserve following its unanimous decision to raise interest rates by 0.25 percentage points. Despite his disapproval of the rate hike, Trump defended Fed Chairman Kevin Warsh, attributing the policy to a hostile board rather than the chairman's personal agenda. Warsh justified the increase as a necessary step to curb high inflation and restore the central bank's 2% price stability goal. Trump reiterated his belief that interest rates remain too high and suggested they should ideally be around 1%. During a press conference, Warsh emphasized the importance of Federal Reserve independence, stating that the institution must operate without political interference. He described this independence as a two-way street where the Fed stays out of trade and fiscal policy matters. Although Trump expressed frustration with the rate decision, he notably refrained from attacking Warsh directly on social media. This reaction contrasts with the intense pressure the White House previously placed on former Fed Chairman Jerome Powell. Ultimately, the tension highlights the ongoing friction between the executive branch's economic preferences and the central bank's mandate.