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Trump ramps up pressure on Powell to slash rates to 1% even as the Fed holds at 3.50%\u20133.75%, lifts inflation forecasts, and warns the Iran oil shock risks stagflation.<\/p>\n
\n Summary<\/span>\n <\/p>\n <\/p>\n U.S. President Donald Trump renewed his public pressure campaign on Federal Reserve Chair Jerome Powell on Thursday, stating that Powell should cut interest rates \u2014 a demand that stands in direct contradiction to the Fed\u2019s posture just 24 hours earlier, when the central bank held rates unchanged and signaled it expects only one cut for the entirety of 2026.<\/p>\n Trump\u2019s statement, reported by Jinshi on Thursday, follows a pattern of escalating attacks on the Fed chair that has intensified since the Iran war began on February 28. As recently as March 12, Trump took to Truth Social to write: \u201cWhere is the Federal Reserve Chairman, Jerome \u2018Too Late\u2019 Powell, today? He should be dropping Interest Rates, IMMEDIATELY, not waiting for the next meeting!\u201d The president has reportedly called for rates as low as 1%, even as soaring oil prices are pushing inflation expectations sharply higher.<\/p>\n <\/p>\n Crypto markets have been trading this showdown in real time: Bitcoin has already slipped back below $70,000 after briefly tagging the mid\u2011$73,000s last week, while Ethereum has faded toward the low\u2011$2,200s as Fed funds futures price in barely a single cut for 2026 and the market starts to contemplate a \u201cno\u2011cut\u201d year. That leaves BTC<\/a> caught between two narratives \u2014 a\u00a0stagflation<\/a>\u00a0hedge if Powell caves to Trump and lets real yields fall, or just another high\u2011beta risk asset if the Fed digs in and higher-for-longer rates collide with an oil shock to crush liquidity across both TradFi<\/a> and crypto.<\/p>\n The Fed voted to keep its benchmark rate in the 3.50%\u20133.75% range at its March 18 meeting, citing persistent uncertainty around both the Iran conflict\u2019s economic impact and the residual effects of Trump\u2019s 15% global tariff regime. Powell acknowledged that a rate hike remains unlikely but did not rule it out, noting that the Fed \u201cwill need to assess how enduring this situation is\u201d in reference to the global energy crisis.<\/p>\n The Fed\u2019s updated forecasts are expected to revise inflation projections upward, with many economists anticipating the central bank will now forecast inflation remaining as high as 3% by late 2026 \u2014 a level difficult to reconcile with rate cuts. Trump\u2019s own nomination of Kevin Warsh to succeed Powell when his term concludes in May had been expected to usher in a more dovish era, but the Iran conflict may delay or complicate that transition.<\/p>\n The core tension is acute. Trump wants lower rates to stimulate a slowing economy and support financial markets battered by oil-driven uncertainty. But the Fed faces a classic stagflation dilemma: cutting rates risks entrenching oil-fueled inflation, while holding or hiking risks amplifying the demand destruction already underway as energy costs squeeze consumers and businesses.<\/p>\n CME FedWatch data shows markets assigning over 99% probability to no change at the current meeting, and Wall Street economists are increasingly calling for a zero-cut year. Oxford Economics chief U.S. economist Lydia Boussour noted that \u201cgiven our elevated forecasts for headline and core PCE inflation, we have adjusted our baseline to reflect only one 25 basis point cut in 2026 \u2014 but it is entirely plausible the Fed won\u2019t implement any rate cuts this year.\u201d\u200b<\/p>\n The oil shock has already erased the inflation buffer that lower energy prices had provided earlier in 2026 in the face of Trump\u2019s tariffs. With Brent crude above $110 and Iranian strikes on Gulf energy infrastructure widening on Thursday, the Fed\u2019s margin for maneuver is narrowing \u2014 even as Trump\u2019s demands grow louder.<\/p>\n <\/p><\/div>\n\n\n