Trump calls Powell a 'total loser' after Fed holds rates steady

• Trump criticizes Jerome Powell for keeping interest rates unchanged
• Fed holds interest rates steady, cites inflation as a concern
• Trump's pressure mounts for rate cuts

Current US President Donald Trump has again launched scathing criticisms against Federal Reserve Chairman Jerome Powell. Following the Fed's decision to keep interest rates unchanged for the fifth consecutive meeting, Trump took to Truth Social to express his frustration, calling Powell "very stupid," "very political," and a "complete loser."

Trump claimed that Powell is "costing our country trillions" and called his tenure at the central bank one of the "most incompetent, perhaps corrupt, of all time." He said the Fed's stance has hindered economic growth and Americans' access to credit.

The monetary authority, in turn, justified keeping interest rates unchanged based on still-pressured inflation data and a robust labor market. In an interview after the decision, Powell stated: "We're close to full employment. We're in a position to cut rates if the data changes, but we're not there yet."

The current president had already publicly advocated, on the same day, for an immediate reduction in interest rates, citing the 3% GDP growth in the second quarter. For Trump, the lack of cuts harms the population's purchasing power and delays the refinancing of housing debt.

The Fed's argument is supported by the latest PCE report, the institution's preferred inflation indicator. The data showed a 2,6% increase in June, up from the previous 2,3%. The core PCE also rose from 2,7% to 2,8% year-over-year, reducing the scope for monetary easing in the short term.

As a result, expectations for a rate cut at the September meeting have dropped significantly. According to CME FedWatch, the chances of a rate cut fell from 58% to less than 47% after the release of the inflation report.

While Powell reinforces caution, Trump raises the political tone in an election year. The clash between the two promises to continue influencing the economic debate in the coming months, with direct effects on the financial markets and appetite for risk assets, including cryptocurrencies.