Trump says Fed nominee should cut rates right away

President Trump on Tuesday said he would be disappointed if the Federal Reserve Chair nominee Kevin Warsh does not cut interest rates right away — comments that came moments before Warsh’s scheduled confirmation hearing on the Hill.

When asked if he’d be disappointed if Warsh didn’t move quickly to lower benchmark interest rates, the president said, “I would,” during an appearance on CNBC’s “Squawk Box.”

“We should have the lowest interest rate in the world,” he later added.

Warsh, who previously served on the Fed’s Board of Governors from 2006-2011, has signaled that he agrees with the president’s push to lower interest rates.

In a November Wall Street Journal op-ed, Warsh wrote, “The Fed’s bloated balance sheet, designed to support the biggest firms in a bygone crisis era, can be reduced significantly.”

“That largesse can be redeployed in the form of lower interest rates to support households and small and medium-size businesses,” he added.

Those comments were in contrast to his “hawkish” reputation during his five-year stint on the board when he encouraged an increase in interest rates to tackle inflation and advocated for the central bank’s independence.

During the second Trump administration, the president has railed against the Fed Chair’s decision to move in a direction that conflicts with his economic policy and agenda.

Trump has shared multiple meme posts labeling Fed Chair Jerome Powell as “too slow” to lower interest rates in addition to bashing the central bank chief he appointed in his first term.

The Trump administration has also initiated a criminal probe into Powell, alleging he made false statements to Congress about renovations at the Fed’s headquarters in Washington, D.C.

Economists have largely defended Powell and have urged the Fed to keep rates steady amid uncertainty from the Iran war and around tariffs.

The Fed Board is set to meet next week to determine if interest rates will soon fall but analysts believe a drop is unlikely.

Treasury Secretary Scott Bessent said he understood the decision to wait on lowering rates but added that the “impetus” is for the Fed to eventually move toward decreasing the federal funds rate.

Trump and Bessent say they believe Warsh will move to lower interest rates upon confirmation.

However, Senate Democrats on the Banking Committee have launched an effort to thwart Warsh’s approval citing concerns with his wealth and ties to assets that could be conflict with the chairman’s independence from institutions he would be responsible for regulating as Fed Chair.

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