President Donald Trump intensified his campaign against Federal Reserve Chair Jerome Powell, demanding immediate interest rate cuts during a fiery rally in Michigan, while accusing the central bank of “economic treason.” The extraordinary broadside marks a dangerous new phase in political pressure on the supposedly independent institution.

The Context:

• Yields on 10-year Treasuries surged to 5.12% this week — their loftiest level since 2007
• 30-year mortgage rates approach 8%, crushing home sales
• Michigan polling shows 62% of voters cite “economic pain” as top concern

Trump’s specific grievances:
✓ Small Business Carnage: “Main Street is dying” (Q1 bankruptcies up 38% YoY)
✓ Manufacturing Slump: Factory activity contracts for 16th straight month
✓ Political Weaponization: “Powell wants to help the Democrats by keeping rates high”

Behind the Scenes:
Sources reveal Trump allies are preparing multiple pressure tactics:
→ Drafting “Audit the Fed 2.0” legislation with 116 House GOP co-sponsors
→ Planning Senate hearings on Fed “overreach” if Republicans regain control
→ Working closely with energy industry leaders to amplify concerns about fuel price volatility in Fed policy discussions

Market Reactions:

• Fed funds futures now price 45% chance of September cut (up from 28%)
• Regional lenders saw sharp gains amid rising expectations of rate cuts, with NYCB jumping 11%
• Dollar index falls 0.9% as traders bet on policy shift

Historical Precedent:
The last president to attack the Fed this aggressively was Nixon, who pressured Arthur Burns ahead of the 1972 election – triggering a decade of stagflation.