Trump to visit Federal Reserve, escalating pressure on Powell over interest rates
U.S. President Donald Trump will visit the Federal Reserve headquarters on Thursday, the White House confirmed, intensifying pressure on Fed Chair Jerome Powell just days ahead of a key policy meeting. The visit, unannounced until late Wednesday, marks a rare and controversial move that further blurs the line between the White House and the traditionally independent central bank.
Trump’s visit, scheduled for 4 p.m. (2000 GMT), comes amid ongoing public clashes with Powell, whom he nominated in 2017 but has since frequently criticized. This week alone, Trump called Powell a “numbskull” and floated the idea of replacing him, News.Az reports, citing Reuters.
Tensions escalated further as White House officials accused the Fed of mismanaging a costly renovation project at its Washington headquarters. Budget director Russell Vought said the renovation is "$700 million and counting," raising concerns of oversight failure and possible fraud.
“This visit feels less like a policy engagement and more like an intimidation tactic,” said Matt Simpson, a senior market analyst at City Index.
Despite earlier denials, Trump is now confirmed to attend the visit personally. It’s unclear whether he will meet with Powell directly. The Fed has declined to comment.
Presidents typically steer clear of interfering with Fed policy, but Trump has consistently challenged that norm. Since his return to office in January, he has attacked several key institutions—including the judiciary, academia, and media—and now appears to be targeting the Fed with renewed focus.
He has publicly demanded interest rate cuts to as low as 1%, arguing that lower rates would help finance the government's rising deficits under his tax and spending proposals. Currently, the Fed's benchmark rate stands between 4.25% and 4.50%.
None of the Fed’s 19 policymakers project rates falling anywhere near Trump’s desired 1%. Even the most dovish forecasts suggest rates might drop to 2.25%-2.50% over the next two years. The Fed is expected to hold rates steady at next week’s meeting, with possible cuts anticipated in September.
“Trump’s threats and rhetoric risk doing lasting harm,” former Fed chairs Ben Bernanke and Janet Yellen warned in a New York Times op-ed this week.
They emphasized the importance of the Fed’s independence, calling its credibility “a national asset” that is “hard to acquire and easy to lose.”
Although Trump cannot legally fire Powell without cause, the administration appears to be building a case through the renovation controversy. Treasury Secretary Scott Bessent stated that the White House is not rushing to nominate a successor but will likely announce one in December or January, ahead of Powell’s term ending in May 2026.
Market reaction to the news was limited. The yield on 10-year U.S. Treasury bonds held steady at 4.387%, while the dollar edged slightly lower in early Asian trading.
As the central bank seeks to navigate economic uncertainties, Trump’s direct intervention adds a new layer of volatility—and raises fresh questions about the future of monetary policy independence in the United States.
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