Trump Calls For Interest Rates Of 1% Or Less After Fed Hikes Rates

Topline

President Donald Trump called for interest rates of 1%, or less, Wednesday, ranting on Truth Social hours after the Federal Reserve raised rates for the first time in three years amid heightened inflation and energy prices.

Trump urged lower rates in a Truth Social post Wednesday.

Photo by Brendan Smialowski / AFP via Getty Images

Key Facts

Trump said in a Truth Social post, “Interest Rates in the United States should be 1%, or less, because we are the Best Credit in the World — BY FAR,” adding the U.S. is “BOOMING with new investment.”

The president, who has engaged in an escalating trade war with Canada resulting in tit-for-tat tariffs, said the U.S. is “‘carrying’ almost every country in the World, and that cannot go on any longer.”

The Fed likely raised rates to combat persistent and heightened inflation that has remained above its 2% target for years, with the annual inflation rate reaching 3.4% last month.

Federal Reserve Chair Kevin Warsh, who Trump nominated this year in hopes of adopting a dovish approach, voted alongside all members of the Federal Open Market Committee on Wednesday to raise rates.

CRUCIAL QUOTE

“LOWER THE INTEREST RATES FOR THE UNITED STATES OF AMERICA, AND FAST!” Trump posted.

Big Number

5.25%-5.5% That was how high interest rates reached in 2024 as the Fed moved to aggressively raise rates from near zero in order to combat soaring inflation amid the COVID-19 pandemic recovery and Russia’s invasion of Ukraine. Inflation briefly eclipsed 9% in mid-2022, but the Fed began lowering rates in 2024 as inflation cooled.

Key Background

The rise in rates comes after the Fed voted 9-3 to keep rates steady during a July meeting. The Fed’s decision to bump rates up came as consumer prices jumped 3.4% year-over-year in August and the core consumer price index grew 2.4%, well above the Fed’s 2% goal. Jobs increased by 162,000 in August while the unemployment rate remained steady at 4.1%. Trump has repeatedly called for lowered interest rates and even threatened to cut trade with countries the U.S. has a deficit with if the Fed does not reduce rates.