US President Donald Trump has called on the Federal Reserve to cut interest rates despite rising inflation and stagnant consumer prices. In a post on Truth Social on Friday morning, Trump claimed there is “no inflation,” citing lower gas prices, grocery costs, and energy expenses. However, data shows that consumer prices are still rising, with a 2.4% year-over-year increase in March.
Trump’s comments come after the April jobs report showed better-than-expected hiring last month. The president pointed to these positive trends as evidence of an economic recovery but noted that inflation remains above target. The Fed’s 2% inflation rate is higher than it was during most of Trump’s first term, when average annual compound inflation was around 1.8%.
The latest data on gas prices and mortgage rates seems to support Trump’s claims, with gasoline at $1.98 per gallon and mortgage rates down from 7.08%. However, other indicators contradict his assertions, including the fact that consumer prices have increased by 2.4% year-over-year.
Most investors do not expect the Fed to cut interest rates soon, given inflation above target and a strong job market. According to the CME FedWatch tool, markets see a near-100% chance the Fed will leave rates unchanged at its policy meeting next week.
Source: https://www.businessinsider.com/trump-inflation-gas-prices-economy-interest-rates-fed-jerome-powell-2025-5