Trump wants Fed to cut rates 'NOW'
President Donald Trump is calling on Federal Reserve Chairman Jerome Powell to lower interest rates right away to avoid an economic pullback.
In a Monday post on his social media platform Truth Social, the president cited lower energy costs and food prices, among other declines, as a reason that holding the interest rate to keep inflation in check is not necessary.
"With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy" unless Powell and the Fed take action "NOW," Trump wrote.
National media including Bloomberg, CNN and The New York Times said Trump's comments helped push the Dow Jones Industrial Average down nearly 1,000 points and S&P 500 down about 2.4% on Monday. The U.S. Dollar Index dropped to 97.92, its lowest level in more than three years.
But the Fed chair made no promises last week, telling the Economic Club of Chicago that the level of Trump's tariff increases is larger than expected and could trigger inflation.
"As that great Chicagoan Ferris Bueller once noted, 'Life moves pretty fast,'" Powell said in the speech mentioning the fictional lead in the 1986 movie "Ferris Bueller's Day Off."
Powell also said, "For the time being, we are well-positioned to wait for greater clarity before considering any adjustments to our policy stance."
Economic index portends slower growth but no recession
The national Conference Board Leading Economic Index, or LEI, shows economic activity could be on the decline, but a recession doesn't appear imminent.
The LEI, released Monday, fell 0.7% in March after a revised decline of 0.2% in February. It also dropped 1.2% in the six-month period that ended in March, compared to a 2.3% decline from March to September 2024.
"The slower projected growth rate reflects the impact of deepening trade wars, which may result in higher inflation, supply chain disruptions, less investing and spending, and a weaker labor market," said Justyna Zabinska-La Monica, a senior manager at The Conference Board, in a statement.
Still, Zabinska-La Monica pointed out that the latest reading does not indicate the U.S. is in a recession or near one.
The index, meant to signal peaks and troughs in the business cycle, includes a compilation of the average weekly hours in manufacturing, building permits for new homes and eight other data points.