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Trump pressure on the Fed could return if US inflation forces hikes

Commerzbank warned renewed political verbal attacks on the Fed could follow if inflationary pressures push the Fed toward higher rates.

Reported · Written up by our desk · Central Banks

Commerzbank analysts, cited by FXStreet, said Donald Trump’s pressure campaign toward the Federal Reserve has been closely tied to the inflation outlook and the prospect of rate hikes.

The analysis used a “Central Bank Pressure Index” and noted that Trump’s criticism appeared to cool after Kevin Warsh became chair, but warned it could flare again if the Fed faces renewed inflationary pressures.

FXStreet reports Commerzbank pointed to past episodes during Trump’s terms in office, including 2019 and 2020 verbal disputes with Fed Chair Jerome Powell, and it said early 2025 brought renewed calls for faster rate cuts alongside personal attacks.

The note also said that even with the leadership change from Powell to Warsh, renewed interference could return if inflation puts the Fed in a position to raise rates, adding that three of the twelve FOMC members recently voted for such a move.

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