Continue to attack Powell! Trump criticized him as "stupid" and called for interest rates to be lowered to 1%.

President Trump once again challenged Federal Reserve Chairman Powell, not only vehemently criticizing his high interest rate policy, but also calling him a "fool" and urging the Fed to lower the federal benchmark interest rate to 1%. This statement has sparked widespread controversy in the market and the economic community against the backdrop of current inflation still exceeding targets and stable economic performance. Since his first term in 2018, Trump has been continuously criticizing Powell, and his recent attacks have become particularly frequent and intense. Since June 2025, Trump has publicly criticized the Fed and Powell almost every one to two weeks on different occasions. On Monday, Trump said, "We have a very terrible Federal Reserve chairman, very terrible. I have tried to be nice to him, but it didn't work." He also added, "Every time the interest rate goes up by one percentage point, we have to pay an additional $360 billion. Why should we still be paying such high costs now that the rate is around 4.5%?" Trump emphasized that the United States should lower the rate to 1% to reduce borrowing costs, "We should only pay 1% interest, not 4.5%." However, analysts point out that the 1% interest rate level advocated by Trump is usually a measure taken in response to economic crises. In the past 25 years, the Fed has only lowered rates to such a low level in extreme situations such as financial crises or the impact of the COVID-19 pandemic. The current US economy does not meet these conditions. Employment is nearing full, inflation remains above the Fed's 2% target, and economic growth is stable. Lowering rates indiscriminately in this environment is not only detrimental to price stability, but may also be interpreted by the market as the Fed yielding to political pressure, weakening its independence and credibility. Especially considering the massive size of the US Treasury market at $36 trillion, losing investor confidence in the Fed could trigger market turmoil. In addition to monetary policy disputes, the White House and the Fed have recently engaged in intense conflict over a $2.5 billion office building renovation project. According to media reports, the Fed is planning a comprehensive renovation of its headquarters, the Eccles Building, and another office building in Washington. The initial budget was $2.5 billion, but cost overruns have sparked controversy. The Trump administration strongly questioned the project, calling it a "financial management failure." National Economic Council Director Hassett said in an interview, "The Fed can print money and then spend $2.5 billion to build a building without congressional oversight, a situation that was never envisaged when the Federal Reserve Act was passed." Facing controversy, Fed Chairman Powell has requested the Fed's Inspector General to review the renovation project. According to detailed Q&A documents released on the Fed's website, the renovation project includes removal of asbestos and lead hazards, upgrading building safety standards, and meeting modern office needs. The Fed emphasized that it does not rely on taxpayer funds to operate and the project is not supervised by the White House Budget Office. Former Fed governor Warsh said in a Fox News interview that the renovation expenditure was "shocking" and criticized the central bank for deviating from its core mission. Worth noting is that Warsh is considered a strong competitor to become the next Fed chairman after Powell's term ends. White House Office of Management and Budget Director Vought also posted on social media, calling the project a "Versailles of France" and a symbol of a "financial management disaster."