The Wall Street Journal editorial board has Jerome Powell’s back following President Trump’s blistering social media criticism of the Federal Reserve chair this week after he offered negative economic predictions over Trump’s tariffs.
“The problem for Mr. Trump is that Mr. Powell spoke the truth,” the conservative-leaning board wrote in an editorial published Friday. “The main lesson from Trump vs. Powell is that the central bank can’t make up for the economic policy errors of politicians.”
Trump bashed Powell, whom he appointed to the position during his first term in 2018, in a Truth Social post early Thursday morning, writing “Powell’s termination cannot come fast enough!”
“If I want him out, he’ll be out of there real fast, believe me,” Trump told reporters later that day. “I’m not happy with him. I let him know it.”
Powell drew Trump’s ire after he offered a grim assessment Wednesday of the economic outlook in light of Trump’s massive tariff overhaul announced April 3. The remarks prompted a steep drop in securities markets.
“The level of the tariff increases announced so far is significantly larger than anticipated,” Powell told the Economic Club of Chicago. “The same is likely to be true of the economic effects, which will include higher inflation and slower growth.”
Ahead of Powell’s speech, Trump pushed for the Federal Reserve to quickly lower interest rates, but Powell said the independent body needs “greater clarity” on the impact of Trump’s policies before it acts.
The Wall Street Journal board agreed with Powell’s assessment but wasn’t surprised Trump lashed out against him.
“President Trump’s tariff war isn’t going well, with market ructions and evidence of a slowing economy. So it was probably inevitable that Mr. Trump would demand that the Federal Reserve ride to his rescue by cutting interest rates,” the board wrote. “The hard decision for the Fed is whether to look past that one-time increase and assume it won’t become part of consumer inflation expectations.”
Trump accused Powell of being “too late and wrong” in the Fed’s interest rate decisions.
The editorial board acknowledged that the central bank, under Powell’s leadership, has been wrong in the past — notably fostering “a gusher of federal pandemic spending” that led to sky-high inflation, but cosigned Powell’s cautious approach this time.
“The Fed has been trying to claw back from that mistake, with some success,” the board wrote in its editorial. “But the Fed hasn’t reached its target inflation rate of 2%, so Mr. Powell is right to be wary of trying to offset the impact of tariffs by easing money too much or too soon.”
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