Federal Reserve Rates Are Too High, Says Former World Bank Chief

usdollardefense ^ | by Naveen Athrappully

[NoLibZone]

Had Trump never levied tariffs, Powell would argue that he needs to see the potential impact deportations are having.

[E. Pluribus Unum]

The same folks who run our privately owned “federal” reserve run the European banks too. They have all lowered their interest rates. They are using the banks for economic warfare.

[linMcHlp]

Any drop is going to launch more inflation.

[BenLurkin]

The rent is too high.

[laplata]

Had Trump never levied tariffs, Powell would argue that he needs to see the potential impact deportations are having.

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That’s right.

He hates Trump more than he cares about doing the right thing for the country.

[Alberta's Child]

The U.S. dollar has lost something like 15% of its value through the first half of 2025. Cutting rates in this environment would be a disaster.

[Political Junkie Too]

Powell is starting to feel the pressure.

He's taken "absolutely no rate cuts in July" off the table in his latest comments.

-PJ

[cowboyusa]

In 1913, a Dollar was worth a Dollar. Today I is worth 4 cents.😡🤡

[Carry_Okie]

The a-hole is trying to increase the debt, gain leverage at the bond auction, and blame Trump’s tax cuts.

[The Louiswu]

So for those of not experts in this area of government, who’s right and why? What does Trump know or believes he knows that makes him want to lower rates?

[fidelis]

[Jeff Chandler]

TDS

[Mlheureux]

The fed is a private entity which is no friend of Americans.

[KarlInOhio]

The banks aren’t doing it because all they want to do is lend to the government,” Malpass said.

They wouldn't be able to do that if the government didn't overspend the revenue by a couple trillion dollars every year.

[Bobbyvotes]

I like high rates. It gives me better income via purchase of bonds.

[Bobbyvotes]

Cutting rates will make it much harder to sell bonds to cover trillions of deficit spending year after year. Rates can not come down so long as politicians are over spending.

[Alberta's Child]

Exactly. The Fed Funds Rate means nothing if long term U.S. Treasury bonds are still being issued at rates near 5%.

[volare737]

Agreed. Lowering rates would weaken the dollar even more (it’s already lost over 10% this year)—and put upward pressue on inflation.

[Owen]

The May PCE report showed an uptick for inflation in the core parameters. 0.2% month to month and 0.1% Y/Y. That is not declining inflation. That is increasing inflation. A bottoming.

Does this mean rates should do . . . anything? Nope. There is no proof that rates decide inflation in either direction. There are many, many instances in history where rates did one thing and inflation the other.

But regardless of all that, inflation is rising, per the May report. And buried in that report was an upward revision on the April report.

[Colorado Doug]

It’s a shame that Trump does not have full control of the CIA. It would be time for persuasion.