US President Donald Trump said he has no plans to fire Federal Reserve Chair Jerome Powell. This announcement came despite Trump’s long history of criticizing Powell for not cutting interest rates fast enough. Speaking in the Oval Office on Tuesday, Trump said he hopes Powell will “act more quickly” to lower rates but confirmed, “I’m not firing him.”
Trump’s comments come at a time when global markets are uneasy due to rising trade tensions and mixed economic signals. His statement about Powell is seen as an effort to calm investors and show leadership stability.
Trump Pushes for Lower Rates
Trump has often said that interest rates in the US are too high. He wants the Federal Reserve to lower them faster to boost the economy. Lower interest rates can make borrowing cheaper, which may help businesses and consumers. Trump believes this will also help the US compete with other countries that have lower rates.
“I think we could be growing faster,” Trump said. “If the Fed would move faster, we’d be in a great spot.”
Many experts warn that political pressure on the Fed could weaken its independence. The Federal Reserve is supposed to make decisions based on data, not politics. Still, Trump insists that his opinions are based on common sense, not control.
Hope for a Deal With China
Alongside his remarks on Jerome Powell, Trump also talked about the ongoing trade conflict with China. He said he still sees a chance for a deal. “I want a fair deal,” Trump stated. “And we can make it happen with respect.”
He explained that while some tariffs could be reduced under a deal, they would not be completely removed. Trump said tariffs give the US strength at the negotiating table.
Treasury Secretary Scott Bessent also sounded hopeful earlier this week. He called the current trade fight “unsustainable” and said he believes the two sides will find a way to ease tensions.
Tariff War Continues
Since early 2025, Trump has imposed steep tariffs on Chinese imports—some reaching 145%. The administration also said more goods could face up to 245% in tariffs by July. China responded with tariffs of its own, including 125% duties on American exports.
The trade war has hurt both countries. Businesses in the US say the extra costs are hard to manage. Farmers, in particular, have seen falling sales and rising prices on equipment. In China, some factories have reduced production or closed due to lower demand from the US.
While Chinese leaders have not formally answered Trump’s latest comments, state-run media outlets say his policy may be hurting the U.S. more than China. A Global Times article quoted experts saying the tariffs “boomeranged” and led to job cuts and higher prices in the US.
Global Markets React
Markets responded to Trump’s comments with mixed results. On Wednesday, Japan’s Nikkei index rose 1.9%, and Hong Kong’s Hang Seng gained 2.2%. China’s Shanghai index dropped slightly by 0.1%. In the US, the S&P 500 climbed 2.5%, and the Nasdaq rose 2.7% on Tuesday.
Investors welcomed Trump’s calm tone and hopes for a trade deal. But many still worry that the trade fight and pressure on the Fed will hurt long-term growth.
The International Monetary Fund (IMF) recently lowered its US growth forecast more than any other major economy. It said new tariffs and global uncertainty could slow growth in 2025.
Experts Caution About Inflation
Economists warn that pushing the Fed too hard could lead to rising inflation. If rates are cut too much, prices could go up faster than wages. This would reduce the buying power of everyday people.
However, others believe the Fed has room to cut rates without risk. The current inflation rate is low, and job growth is slowing. These conditions often support rate cuts.
It is still unclear how the US-China trade conflict will end. Talks are expected to continue, but both sides have deep concerns. Trump’s softer tone may help restart formal talks, though it’s too early to say for sure.
For now, Trump says he will let the Fed do its job. And while he still believes the US needs lower rates, he’s taking a step back from direct action.
Meanwhile, markets remain alert. Investors, businesses, and everyday people are all watching closely. The decisions made in the coming weeks could shape the US economy for years to come.