Trump Urges Rate Cut...Pressures Mount Ahead of Warsh's First FOMC Meeting

Kevin Warsh to Lead First FOMC Meeting
Trump: "Rates Should Be Lowered"

U.S. President Donald Trump argued that it would be a mistake for the Federal Reserve (Fed) to raise interest rates solely because employment figures came in stronger than expected. However, he stated that since Kevin Warsh, the Fed Chair, is about to preside over his first Federal Open Market Committee (FOMC) meeting, he does not want to influence Warsh’s decision.

In an interview with NBC broadcast on the 7th (local time), President Trump said, "These days, when strong economic indicators are released, the market actually falls due to concerns over a rate hike," adding, "There is absolutely no reason to raise rates."

President Trump continued, "It is wrong to raise the base interest rate," insisting, "On the contrary, we should be cutting rates."

As the South Korean stock market experiences extreme volatility with a 'rollercoaster market' due to remarks by U.S. President Donald Trump, the KOSPI index at the Hana Bank headquarters dealing room in Jung-gu, Seoul, surged before the President's national address (left photo) but plunged over 2% (right photo) after the speech, continuing its sharp decline. April 2, 2026. Photo by Jo Yongjun

President Trump’s comments came amid intensifying economic and political pressure surrounding Fed Chair Warsh, who will preside over his first FOMC meeting on June 16-17. Trump has repeatedly called for rate cuts in public, often clashing with the Fed.

Recent sell-offs in the bond market and shifts in the FedWatch outlook reflect expectations that the Fed under Warsh’s leadership may eventually raise rates to curb inflation that has exceeded its target. Concerns over rising prices have grown as the labor market and the U.S. economy show continued strength.

According to the U.S. Bureau of Labor Statistics (BLS), nonfarm payrolls increased by 172,000 in May. This figure is nearly double market expectations. The figures for the previous two months were also revised upward, while the unemployment rate remained steady at 4.3%.

As a result, Treasury prices declined (yields rose), and the market has now fully priced in the possibility that the Fed will raise its benchmark interest rate by 0.25 percentage points by the end of the year.

President Trump also said, "I have great respect for him (Fed Chair Kevin Warsh)," but added, "However, in my view, you shouldn’t punish a well-performing economy by immediately raising rates." He continued, "We have the national debt issue and other problems to solve," emphasizing, "I want to further increase defense spending."

This content was produced with the assistance of AI translation services.