Slashing government interest rates could have the paradoxical effect of raising the interest rates paid in the real world.

The Federal Reserve’s independence from political interference, viewed as sacrosanct inside the central bank, is under siege.

“Bessent is trying to show Trump there is a path to get what he wants without unnecessary market turmoil,” said Stephen Myrow, managing partner at Beacon Policy Advisors. That path would involve allowing Powell to finish out his term as chair and stepping down from the Federal Reserve board once his chairmanship is up.

The Federal Reserve continued work on its comprehensive effort to rewrite bank rules with a daylong conference at its headquarters on Tuesday.

White House deputy chief of staff James Blair will visit the renovation site at the Federal Reserve's headquarters amid President Donald Trump's concerns with the projects cost overruns.

Treasury Secretary Scott Bessent said Monday he believes the Federal Reserve system should be reviewed for potentially holding back the US economy, which is “on the cusp” of growth that could equal the dot-com boom seen in the 1990s.

Treasury Secretary Scott Bessent offered support for Jerome Powell amid regular attacks from Trump administration officials, saying he sees no reason for the Federal Reserve chair to step down. “There’s nothing that tells me that he should step down right now,

The Trump administration has seized on the Federal Reserve’s renovation of its building in what legal experts say could be pretext to fire Jerome H. Powell, the central bank chair.

For the moment, our central forecast still sees the Fed remaining on hold throughout 2025. For 2026, we have changed our base case to feature one additional rate cut in the first half, which would take the fed funds rate to neutral levels by the end of that year.

The U.S. Federal Reserve's independence is under threat from mounting political interference, according to a clear majority of economists polled by Reuters, although no one expects a July interest rate cut despite a recent divergence in views among policymakers.