President Donald Trump says he will “demand that interest rates be lowered immediately”

President donald trump launched his first broadside at the Federal Reserve, saying Thursday that he will apply pressure to lower interest rates.

Addressing an assembly of world leaders at the World Economic Forum in Davos, Switzerland, the new president in a wide-ranging policy speech did not mention the Federal Reserve by name but made clear he would seek lower rates.

“I will demand that interest rates be lowered immediately,” Trump said. “And in the same way, they should be falling around the world. Interest rates should follow us everywhere.”

The comments represented an opening attack on Federal Reserve officials, with whom he had a highly contentious relationship during his first term. He frequently criticized the President Jerome Powellwhom Trump named, at times calling policymakers “stupid” and comparing Powell to a golfer who doesn’t know how to putt.

Stocks reacted little to the remarks, although the policy-sensitive 2-year Treasury yield fell to 4.29%.

In the flurry of activity surrounding the president’s first week in office, he has not discussed his views on monetary policy. However, during the presidential campaign he indicated that he should have a say in interest rate decisions.

For their part, Powell and his colleagues have emphasized the importance of the Federal Reserve’s independence. Powell, in particular, has frequently insisted that the central bank does not make decisions based on political considerations. Trump has no legal authority over the Federal Reserve, although he appoints members of the Board of Governors.

The Fed’s independence is considered essential to market stability, although the central bank has been criticized in recent years for dismissing the rise in inflation in 2021 as “transitory,” leading to a series of aggressive increases.

Trump’s comments come less than a week before the Federal Reserve holds a two-day policy meeting that will conclude on Wednesday.

Markets give virtually no chance that the Federal Reserve will further reduce its benchmark borrowing rate, which is currently targeting a range between 4.25% and 4.5% after a full percentage point of cuts in recent four months into 2024. Traders are pricing in a first rate cut likely to come in June and a 50-50 chance of another move before the end of the year, according to CME Group data.

The Federal Reserve cut its funds rate after raising it 5.25 percentage points in its efforts to combat inflation. Although inflation is still above the Federal Reserve’s 2% mandate, officials have said policy does not need to be as restrictive as they see the pace of price increases moderating.

Trump attributed the rise in inflation during former President Joe Biden’s administration to the “wasteful deficit spending.”

“The result is the worst inflationary crisis in modern history, and sky-high interest rates for our citizens and even around the world. Food prices and the price of almost every other thing known to humanity skyrocketed,” he stated.

A Federal Reserve official declined to comment on Trump’s comments.