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President Trump’s bold call for a “full point” Federal Reserve interest rate cut could revolutionize America’s inflation battle while simultaneously slashing the crippling interest payments on our national debt.
Key Takeaways
- President Trump has called for the Federal Reserve to implement a full percentage point cut to the benchmark interest rate, which would bring it to 3.25%-3.5%
- Trump cited solid job growth and cooling inflation as justification for the significant rate reduction
- The President believes lower rates would reduce interest payments on government debt and provide “Rocket Fuel” for the economy
- The Fed, which typically moves rates in quarter-point increments, has not made a full percentage point cut since March 2020 during the COVID-19 pandemic
- Trump’s aggressive stance on monetary policy challenges the traditionally independent Federal Reserve
Trump Demands Bold Action on Interest Rates
President Trump has ramped up pressure on the Federal Reserve to implement a substantial cut to interest rates amid signs of cooling inflation. Using his Truth Social platform, Trump urged the central bank to lower its benchmark interest rate by “a full point” following the release of May’s consumer price data. This aggressive stance represents a significant departure from the Fed’s typically cautious approach to monetary policy adjustments, which usually involve quarter-point movements. The President’s call would drop the federal funds rate to 3.25%-3.5%, levels not seen since September 2022.
The timing of Trump’s demand follows the release of inflation figures that showed consumer prices were up only slightly in May. “Great numbers! Fed should lower one full point,” President Trump declared on Truth Social, suggesting that the cooling inflation creates an opportunity for monetary easing that could stimulate further economic growth. His recommendation comes as the Federal Reserve has maintained higher interest rates in its ongoing battle to push inflation down to its 2% annual target, a stance that Trump believes is now unnecessarily restricting economic expansion.
❝FED SHOULD LOWER ONE FULL POINT❞
US President Donald Trump hailed lower-than-expected annual and monthly inflation data out while again urging Federal Reserve to lower interest rates to cut cost of borrowing https://t.co/9UvPCuUeOm pic.twitter.com/9ts7cCS1T4
— Anadolu English (@anadoluagency) June 11, 2025
Economic Benefits and Fiscal Strategy
President Trump’s advocacy for lower interest rates extends beyond immediate economic stimulation. He specifically highlighted that “reduced rates would pay much less interest on debt coming due,” addressing one of the most pressing fiscal challenges facing the nation. With the national debt reaching historic levels, the interest payments alone have become a significant burden on the federal budget. Trump’s approach represents a pragmatic strategy to alleviate this financial pressure while simultaneously encouraging economic growth.
“Rocket Fuel!,” said President Donald Trump.
The magnitude of Trump’s proposed cut is particularly notable. The last time the Federal Reserve implemented a full percentage point reduction was in March 2020, at the onset of the COVID-19 pandemic when emergency measures were needed to stabilize the economy. By advocating for a cut of similar scale now, Trump is signaling his belief that aggressive monetary policy can be a powerful tool for economic management even under more stable conditions. His approach contrasts with the European Central Bank, which has been more willing to implement rate cuts.
Challenging Fed Independence
Trump’s direct and public pressure on the Federal Reserve represents a continuation of his willingness to challenge institutional norms regarding the central bank’s independence from political influence. While the Fed is designed to operate independently to make objective economic decisions, Trump has consistently made his preferences for monetary policy known. Some Fed officials have expressed caution about implementing the cuts Trump desires, citing concerns that his proposed tariff policies could potentially cause inflation to increase again.
“US President Donald Trump on Wednesday insisted that the Federal Reserve should cut interest rates after the release of inflation data that showed consumer prices up slightly in May,” said Donald Trump.
Despite these institutional concerns, Trump’s economic instincts have often proven correct during his presidency. His focus on monetary policy as a tool for economic management highlights his practical approach to governance, prioritizing tangible results over adherence to established protocols. By pushing for these substantial rate cuts, President Trump continues to demonstrate his commitment to using every available lever to strengthen the American economy and reduce the burden of government debt on taxpayers.