Trump demanded the Fed have a "special meeting" to cut rates "right now"

US President Donald Trump has demanded that the Federal Reserve hold a "special meeting" and cut interest rates "right now". On Tuesday, March 17, the Fed's two-day meeting will begin, at the end of which it will announce its decision on rates. Traders do not count on their reduction in March.

Donald Trump said on March 16 that the U.S. Federal Reserve "should have a special meeting" to cut rates, The Wall Street Journal reports.

"What better time to lower interest rates than now? Even a third grader knows that," Trump reported (quoted in WSJ).

Trump's demand came a day before the Fed's two-day meeting: it starts on Tuesday, March 17, and the regulator will announce an interest rate decision on Wednesday.

Traders are almost 100% sure that the Fed will leave rates at the current level: 3.5-3.75%, the FedWatch tool shows. The probability of lowering rates by 0.25 percentage points is estimated at only 0.9%. Moreover, even before the U.S. war with Iran, due to which oil prices rose sharply, the chances of easing monetary policy were estimated by the market low: 9.2% on February 13.

Trump has been pressuring the Fed to cut rates more aggressively since his return to the White House in January 2025. The US President has made no secret of his dissatisfaction with the current head of the Federal Reserve Jerome Powell. Powell's authority at the head of the Fed expires in May 2026. Trump on March 4 officially nominated economist Kevin Warsh to be the next Fed chairman. His nomination still has to be confirmed by the Senate.

In January, the U.S. Justice Department opened an investigation into Powell related to the $2.5 billion renovation of the Fed building in Washington, D.C. The Fed chief said the investigation "should be viewed in the broader context of threats from U.S. President Donald Trump's administration and continued pressure" to demonstrate influence over the regulator.

Powell, after resigning as Fed chairman, is eligible to remain on its Board of Governors until January 2028. Powell declined to comment on whether he would take advantage of this opportunity. However, court filings in Powell's case quote his lawyer as saying that "Powell cannot resign while the criminal investigation is ongoing to protect the Fed's independence," Bloomberg, which has seen the documents, reported.

The signal was the first public hint that the Fed chief may take the opportunity to stay at the central bank even after the chairman's term ends in May. Usually, Fed heads leave the Fed after the end of their terms, Bloomberg explains.

The length of the investigation could complicate a change in Fed leadership, with one Republican senator promising to block appointments while the investigation continues, which could delay Worsh's confirmation, Bloomberg notes.

"[Powell] may stay on after the chairman's term ends in mid-Ma. He has a couple more years [of authority], and that seriously complicates the president's quest to control the Board [of Governors] and the Fed itself. That's very valuable leverage," Bloomberg quoted Potomac River Capital co-founder and Fed expert Mark Spindel as saying.

This article was AI-translated and verified by a human editor