US President and Vice President Attack Powell: Refusing to Cut Interest Rates Again Would Be Dereliction of Duty!

After the inflation report was released, Trump and Vance "joined forces" on social media to pressure the US Fed, urging the US central bank to lower interest rates as soon as possible.

On Wednesday (June 11) local time, Trump posted on his social platform "Truth Social," saying, "The CPI data just came out, and it's great! The Fed should cut interest rates by a full percentage point."

Trump added that if the Fed were to cut interest rates, it would significantly reduce the interest payments the US government has to make on its soon-to-expire debt, "It's so important!!!"

Meanwhile, US Vice President Vance echoed on the social media platform X, "The President (Trump) has been saying this for a while, but now it's clearer: The Fed's refusal to cut interest rates is a dereliction of duty in monetary policy."

Data released before the US stock market opened showed that the US Consumer Price Index (CPI) rose 0.1% MoM and 2.4% YoY in May, both lower than market expectations of 0.2% and 2.5%, respectively.

Excluding food and energy costs, the core CPI rose 2.8% YoY, remaining at its lowest level since March 2021 and also below market expectations of 2.9%.

US Treasury Secretary Scott Bessent wrote in his prepared testimony for the House Ways and Means Committee hearing, "Due to the slowdown in the increase of housing, food, and energy costs, the inflation rate is at its lowest level since 2021."

Bessent also stated that due to the rise in prices over the previous four years, the living standards of Americans have declined, but under the Trump administration's policies, inflation in the US is showing significant improvement.

However, it should be noted that even though the latest report is better than market expectations, the two YoY increases are still higher than the Fed's 2% inflation target. Some central bank officials have indicated that they prefer to "stay put" to observe the impact of tariffs on prices.

The Federal Open Market Committee (FOMC) of the US Fed is scheduled to announce its interest rate decision in a week, and currently, the market expects almost no possibility of a rate cut at this meeting. According to the CME Group's model, the next rate cut may not come until September.

Elyse Ausenbaugh, a senior executive at JPMorgan Chase, believes that the inflation figures suggest that now may be the time to cut interest rates again, but "I expect the Fed to emphasize the current uncertainties and hope to avoid acting prematurely. It's a tough decision."