Wosh's first move after taking office: Trump claims that the rate hike is just to suppress success.

Author: Long Yue, Wall Street Insights

On the eve of the first Federal Reserve policy meeting hosted by Vice Chairman Worsh (Powell), Trump publicly pressured the central bank chief he personally nominated, demanding a rate cut.

In an interview with NBC’s “Meet the Press” on Sunday, Trump said plainly: “There is no reason to raise interest rates.” He said, “We built this country by doing things right and keeping interest rates low. When they raise rates, it’s an attempt to choke off success. I don’t want to choke off success. We should actually be cutting rates.”

Trump appears to give Worsh plenty of room, but there is more behind the words. “Kevin is excellent, and I hope he acts according to his own judgment,” he said. “But my feeling is that when a country is developing well, it shouldn’t immediately raise rates to punish it—it should be given incentives.”

Worsh was officially confirmed last month to serve as the Federal Reserve Chair and will chair its first Federal Open Market Committee (FOMC) meeting on June 16 to 17.

The timing of Trump’s remarks is quite sensitive. Just last Friday, a strong jobs report was released, showing that after the turbulence of 2025, the U.S. labor market has been stabilizing, prompting markets to increase their bets—namely that the Federal Reserve may be forced to raise rates within the year in order to deal with inflation pressures.

Inflation pressure is real, and “hawkish voices” already exist within the Fed

The root cause of inflation rising is the war in the Middle East. At the beginning of the war, Iran blocked the Strait of Hormuz, leading to a sharp surge in oil prices. This upward pricing pressure has spread throughout the entire U.S. economy. This April, the U.S. inflation rate rose to 3.8%, the highest in three years. Economists surveyed by Bloomberg predicted that the May data will be released this Wednesday and is expected to rise further to 4.2%.

Some officials within the Federal Reserve have already spoken out publicly about their concerns. On Friday, Cleveland Fed President and FOMC member Beth Hammack said: “If the recent trend continues, action may soon be needed.” She noted that the latest employment report shows the labor market is “roughly balanced,” and that “high inflation is the bigger hidden risk.”

U.S. Treasury Secretary Besentech’s stance is relatively moderate. He said it is reasonable for the Federal Reserve to wait until the war’s impact on inflation becomes “clearer” before further cutting rates.

Trump’s logic: if the economy is doing well, it shouldn’t be punished

Given this situation, Trump’s position is: the better the economy is, the less it should be punished with rate hikes.

“We’re doing very well, but whenever you do well, they want to raise rates—that’s not fair,” he said. “It should be the other way around.”

Trump has previously repeatedly called for the Federal Reserve’s benchmark interest rate—currently in the range of 3.5% to 3.75%—to be cut sharply to 1% or even lower. He has also repeatedly criticized Worsh’s predecessor, Powell, calling him a “loser” and a “fool,” because Powell did not cut rates fast enough.

For Worsh, Trump gives him room on the surface, but there is a message in the wording. “Kevin is excellent, and I hope he acts according to his own judgment. I don’t want to exert too much influence on him,” he told NBC. “But my feeling is that when a country is developing well, it shouldn’t immediately raise rates to punish it—it should be given incentives.”

Worsh had previously indicated a preference for lowering borrowing costs, but after the outbreak of the Middle East conflict, inflation jumped, leading some FOMC members to begin discussing the possibility of raising rates.