Trump Calls for Pressure on Federal Reserve Chair Jerome Powell: What’s Ahead for Bitcoin?
Trump is accusing Jerome Powell of maintaining high interest rates and burdening the U.S. with excessive interest payments. Will Bitcoin continue its climb past $112,000?
Yesterday, Bitcoin briefly surged above $112,000, revisiting the highs seen in May 2025. Unlike the all-time highs achieved on May 22, the July 9 rise came after a period of consolidation post the relief rally from June 23. Current technical indicators favor bullish trends.
BTC - ▲2.20%
Trump’s Remarks on Jerome Powell
In a heated address, Trump did not hold back on his criticism of Federal Reserve Chair Jerome Powell, labeling him as “low IQ” and “very stupid” for his reluctance to decrease interest rates. He noted that Powell’s actions are financially detrimental to the nation.
In a video clip that circulated widely, Trump expressed concern over the rising costs associated with maintaining the national debt, which exceeds $35 trillion as of September 30, 2024. Trump emphasized that every moment Powell declines to cut rates, the U.S. incurs billions more in interest obligations. If the current interest rates remain, projections from the Congressional Budget Office forecast that net interest payments could escalate to $1 trillion annually by 2030.
In light of these comments, Bitcoin is seeing an uptick, possibly driven by the speculation this might push the cryptocurrency market higher.
What Lies Ahead for the Federal Reserve?
The future of monetary policy rests with Powell and the Federal Open Market Committee (FOMC), who aim to balance inflation rates around 2% while promoting economic growth. Despite opportunities to reduce rates in June 2025, they opted to retain them between 4.25% – 4.5%. Economists forecast that Powell will likely keep rates steady during the upcoming meeting on July 30.
Low interest rates typically favor Bitcoin and could allow for price stability, though failure to adjust rates could reverse any gains made recently.
Implications of Tariffs on Inflation
Trump’s threats of increased tariffs against main trading partners could potentially drive consumer prices up, exacerbating inflation. Analysts like Jamie Dimon from JPMorgan have cautioned that such tariffs are influencing the Federal Reserve’s hesitation to cut rates.
While Powell’s term extends to May 2026, he has committed to remaining in his position. The Federal Reserve operates independently, ensuring economic strategies serve the nation without political interference.
Key Takeaways
- Trump criticizes Powell for high rates.
- Bitcoin has recently surpassed $112,000.
- Rising national debt remains a major concern.
- Tariffs may further complicate inflation management.
