Federal Reserve

Aug. 9 (UPI) — The Federal Reserve has not approved an interest rate cut since before the Nov. 5 election, but one of its governors said she wants three rate cuts this year.

Federal Reserve Gov. Michelle “Miki” Bowman dissented from the Federal Open Market Committee’s decision last week to maintain the current Fed rate of between 4.25% and 4.5%, she said on Saturday.

She said “signs of fragility in labor market conditions” caused her to support gradually lowering the Federal Reserve’s interest rate with three successive reductions, starting in July.

“Economic conditions appeared to be shifting,” Bowman said. “As a result, we should reflect this shift in our policy decisions.”

Bowman said, “Inflation has moved considerably closer to our target, after excluding temporary effects of tariffs, and the labor market has remained near full employment.”

“With economic growth slowing this year and signs of a less dynamic labor market becoming clear,” Bowman explained, “I see it as appropriate to begin gradually moving our moderately restrictive policy stance toward a neutral setting.”

“Taking action at last week’s meeting would have proactively hedged against the risk of a further erosion in labor market conditions and a further weakening in economic activity,” she added.

Bowman said the nation’s economy “has been resilient” this year, but consumer spending has eased, while “residential investment” has declined.

“Consumer spending on both goods and services has risen only modestly, reflecting slow gains in disposable personal income, lower levels of liquid savings and high credit card utilization,” Bowman continued.

She cited weakened housing demand that has reached a level that hasn’t been seen since the Great Recession.

“Housing activity has declined, including in single-family home construction and sales, as listings of homes for sale are growing and house prices are falling,” Bowman explained.

The nation’s employment-to-population ratio also has declined significantly so far this year, which she said suggests labor market conditions are softening.

“Payroll employment growth slowed sharply to only 35,000 jobs per month over the three months ending in July,” Bowman said.

“This is well below the moderate pace seen earlier in the year, likely due to a significant softening in labor demand,” she added.

Bowman also said President Donald Trump‘s tariff policies will not “present a persistent shock to inflation” because price-stability risks have eased.

Bowman made her comments while addressing the Kansas Bankers Association’s 2025 CEO & Senior Management Summit in Colorado Springs, Colo., on Saturday.

She is one of seven Federal Reserve governors who serve 14-year terms after being nominated by the president and confirmed by the Senate.

Bowman and Federal Reserve Gov. Christopher Waller both dissented when the Federal Reserve voted to maintain the current interest rates in July.

It was the first time in more than three decades that two Federal Reserve governors dissented from the majority decision, according to MarketWatch.

Trump appointed Bowman and Waller to the Federal Reserve in 2018 and 2020, respectively.

Aug. 8 (UPI) — President Donald Trump on Friday replaced Bill Long as Internal Revenue Service commissioner after less than two months on the job with Treasury Secretary Scott Bessent in a temporary role.

The New York Times was the first media outlet to confirm his ouster and Long later announced his departure on X with plans to become Iceland’s ambassador.

“It is a honor to serve my friend President Trump and I am excited to take on my new role as the ambassador to Iceland. I am thrilled to answer his call to service and deeply committed to advancing his bold agenda. Exciting times ahead!”

A spokesperson for the Treasury Department, which oversees the IRS, said in a statement to NBC News that the department “thanks Commissioner Long for his commitment to public service and the American people. His zeal and enthusiasm to bring a fresh perspective to the Federal Government was evident in both the House of Representatives and as part of the Trump Administration.”

Bessent has already been tasked with negotiating tariff rates as part of trade talks. Also, he is helping with the search for ultimately the next Federal Reserve chairman.

Long was confirmed by the U.S. Senate on June 12 and sworn in as commissioner four days later to a term that was supposed to last through Nov. 12, 2027. Trump nominated him on Dec. 4, 2024. While awaiting confirmation, he was appointed as a senior adviser in the Office of Personnel Management.

Lpng had limited tax experience and had supported the abolishment of the agency, CNN reported.

He served in the U.S. House from 2011 to 2023, representing a district in Missouri, and was previously an auctioneer.

On Thursday, he sent an email to all IRS employees with the subject line: “It’s Almost FriYay that read: “Please enjoy a 70-minute early exit tomorrow. That way you’ll be rested for my 70th birthday on Monday,” The New York Times reported.

He signed it: “Call Me Billy.”

The IRS has been processing tax forms since the April 15 deadline with extensions until Aug. 15.

The IRS workforce has shrunk 25% amid Trump’s government cuts and mass buyouts. In all there are plans to cut its 102,000 workforce by up to 40%, according to a memo obtained by CBS News in April.

And 26% of the agents who conduct audits have left the agency by May, according to the report.

And the IRS has been dealing with new deductions and tax cuts after the passage of the sprawling spending bill, labeled as the “One Big Beautiful Bill Act.” The new law has no tax on tips or overtime.

Seven different people will have led the agency since Trump won the 204 election.

Danny Wefel held the role until Trump’s inauguration on Jan. 20 despite a statutory five-year term.

Other acting commissioners had policy differences with Trump: Doug O’Connell and Melanie Krause. Another acting boss, Gary Shapley, was appointed but ousted Bessent a few days later because he didn’t want him. Deputy Secretary Michael Faulkender became the acting commissioner until Long was confirmed.

Aug. 5 (UPI) — President Donald Trump said Tuesday that Treasury Secretary Scott Bessent is no longer on the list to replace Federal Reserve Chair Jerome Powell.

“Well I love Scott, but he wants to stay where he is,” Trump said on CNBC’s Squawk Box. “I asked him just last night, ‘Is this something you want?’ ‘Nope I want to stay where I am.'”

“I just take him off. He does not want it. He likes being Treasury secretary,” Trump said.

Powell’s term as Fed chair ends in 2026, and Trump has been highly critical of his hesitation to lower interest rates, calling him a “moron” and “too late.”

Trump is considering his own replacements for the Fed’s board of governors amid his criticism of Powell over his stance on interest rates.

Others Trump is considering to replace Powell include Kevin Warsh, a financier and bank executive who previously served on the Fed’s board of governors, and Kevin Hassett, an economist and the head of the National Economic Council at the White House.

“Both Kevins are very good, and there are other people that are very good, too,” Trump said, adding that [Adriana] Kugler’s resignation “was a pleasant surprise.”

Kugler, a labor economist, announced Friday that she would step down from the Fed’s board of governors this Friday. She plans to return to teaching public policy at Georgetown University in the fall.

Another contender for Powell’s job is economist and Fed governor Christopher Waller, whom Trump appointed.

Trump nominated Powell for the Fed job in 2017, during his first term as president. President Joe Biden reappointed him during his term. Trump alleged Tuesday that Powell told him, “Sir, I’ll keep interest rates so low. I’m a low interest rate person.”

Last week, the Fed kept the interest rate unchanged at 4.25%-4.5%. Waller and governor Michelle Bowman, another Trump appointee, dissented. It was the first time two governors had dissented since 1993.

Aug. 2 (UPI) — One of the seven members of the Federal Reserve Board of Governors, Adriana Kugler, announced she is stepping down next week, creating an opening for President Donald Trump to fill.

Her term was set to expire in January but Kugler said Friday she will depart in seven days. President Joe Biden appointed Kugler, a 55-year-old labor economist, in September 2023.

Governors’ terms are for 14 years, and Kugler filled an opening.

“The Federal Reserve does important work to help foster a healthy economy and it has been a privilege to work towards that goal on behalf of all Americans for nearly two years,” Kugler said in her resignation letter to Trump. “I am proud to have tackled this role with integrity, a strong commitment to serving the public, and with a data-driven approach strongly based on my expertise in labor markets and inflation.”

Kugler said she plans to return to teaching public policy at Georgetown University in the fall. She was a vice provost for faculty at Georgetown and earned her Ph.D. in economics at the University of California at Berkeley.

“I am especially honored to have served during a critical time in achieving our dual mandate of bringing down prices and keeping a strong and resilient labor market,” she wrote in the letter.

Kugler did not vote on Wednesday when the central bank’s Federal Open Market Committee kept the benchmark interest rate unchanged at a range of 4.25% to 4.5% for a fifth consecutive meeting. Two of the 11 committee members who did vote dissented, backing Trump’s desire to lower rates.

The 12-member committee includes the seven governors, the president of the Federal Reserve Bank of New York and four remaining 11 Reserve Bank presidents who serve one-year terms on a rotating basis.

“We just found out that I have an open spot on the Federal Reserve Board. I’m very happy about that,” Trump said late Friday before boarding Marine One.

He later posted on Truth Social that Fed Chairman Jerome Powell “should resign, just like Adriana Kugler, a Biden Appointee, resigned. She knew he was doing the wrong thing on Interest Rates. He should resign, also!”

The replacement may ultimately replace Powell, whose term ends in May, though he can remain as a governor until 2028.

The president appoints each of the board members and designates one to serve as chair for four years. Trump appointed Powell during his first presidency in 2018. Biden appointed him to another term as chairman.

“Trump’s influence on interest rates will now be felt earlier and more strongly,” Derek Tang, an economist at LHMeyer, an economic consulting firm, told The Washington Post.

Contenders to lead the Fed are National Economic Council Director Kevin Hassett, former Fed governor Kevin Warsh and Fed governor Christopher Waller, each with distinct strengths, The Washington Post reported. Trump has said he wants Scott Bessent to remain as Treasury secretary.

Trump has sought to replace Powell, calling him on Truth Social “a stubborn MORON” and “too late” on lowering interest rates. But he can only be fired “for cause,” such as malfeasance, neglect of duty or inefficiency, rather than disagreeing with policies.

Experts say his removal could disrupt the financial markets.

July 31 (UPI) — The Federal Reserve‘s preferred inflation gauge rose more than expected in June, according to a report by the U.S. Bureau of Economic Analysis released Thursday.

The personal consumption expenditures index, or PCE, rose 0.3% in June from the previous month and 2.6% from June 2024. Core PCE, which excludes volatile food and energy prices rose 2.8% on an annual basis.

The annual increases were higher than analysts’ expectations of a 2.5% increase for PCE and 2.7% rise for core PCE.

Additionally, when measured at a monthly rate, Americans saw their income increase by 0.3%, or $71.4 billion. However, after taxes that increase in dollars dips to around $61 billion, and the value of the goods and services bought by or for American citizens, or personal consumption expenditures, also rose 0.3% to $69.9 billion.

As for savings, residents held on to $1.01 trillion in personal savings in June, and when measured as a percentage of disposable income, those personal savings came in at 4.5%.

Inflation was also evident via the consumer price index, or CPI, as that rose 0.3% for urban consumers increased 0.3% since June when seasonally adjusted, and 2.7% over the last 12 months not seasonally adjusted, despite dipping as low as 2.3% in April.

The Fed continues to hold short-term interest rates steady at a range of 4.25% to 4.5% following its meeting earlier this week, with Fed Chair Jerome Powell citing earlier this month that the impact of President Donald Trump‘s reciprocal tariff strategy is the reason the Fed hasn’t gotten back to cutting rates.

Trump, who has been pushing for the Fed to lower rates, posted to Truth Social Thursday in regard to the Fed’s hold, saying Powell “is costing our Country TRILLIONS OF DOLLARS,” and called him a TOTAL LOSER.”

July 24 (UPI) — President Donald Trump will head to the Federal Reserve on Thursday amid his ongoing calls for Chair Jerome Powell to resign.

A U.S. president hasn’t visited the nation’s central bank since President George W. Bush in 2006. Trump is slated to arrive at 4 p.m. EDT and take an hour-long tour of the site, as he has expressed disdain for renovations at the office building.

The $2.5 billion renovation project has been part of Trump’s criticism Powell, and the Trump administration has also pushed at Powell, who Trump nominated to the job in 2017.

Trump, as recently as Wednesday, lashed out at Powell, who he has dubbed “Too Late.”

“Housing in our country is lagging because Jerome ‘Too Late’ Powell refuses to lower interest rates,” Trump posted to Truth Social on Wednesday. “Families are being hurt because interest rates are too high, and even our country is having to pay a higher rate than it should be because of ‘Too Late.'”

White House Deputy Chief of Staff James Blair, who has also taken to referring to Powell as “Too Late” on social media, has also been critical of the renovations. Blair has accused the Fed of trying to hide what is being spent on the project before announcing Tuesday that Trump and his people will be making the Thursday visit.

Blair had said on Monday that the Fed released a virtual video of its offices in what he considered an effort to stymie a review at the construction.

“What do they not want us to see?” he said on X.

“We go Thursday!” Blair posted to X Tuesday after inferring that the Fed had relented on blocking a visit due to pressure by the White House.

U.S. Treasury Secretary Scott Bessent said Monday on X he has called for an assessment of the Federal Reserve.

“While I have no knowledge or opinion on the legal basis for the massive building renovations being undertaken,” Bessent said. “A review of the decision to undertake such a project by an institution reporting operating losses of more than $100 billion per year should be conducted.”

Trump has expressed in the past a desire to fire Powell and has suggested that overruns on the cost of the renovations would be a viable excuse to terminate the Fed Chairman. However, Trump has since yielded on that notion and has indicated he will likely instead allow Powell to keep his job until his term expires next May.

July 17 (UPI) — The House of Representatives voted to regulate digital currencies and protect their owners on Thursday during what many lawmakers called “crypto week.”

The House voted 308-222 to approve the Guiding and Establishing National Innovation for U.S. Stablecoins Act, which is dubbed the GENIUS Act.

The measure goes to President Donald Trump for signing and establishes financial guidelines and protections for owners of stablecoins.

“For far too long, America’s digital assets industry has been stifled by ambiguous rules, confusing enforcement and the Biden administration’s anti-crypto crusade,” House Majority Whip Tom Emmer, R-Minn., told media on Thursday.

“President Trump and this Congress are correcting course and unleashing America’s digital asset potential with historic, transformative legislation,” Emmer said.

“President Trump promised to make America the crypto capital of the world,” Emmer added. “Today, we delivered.”

Stablecoins are digital assets that are tied to tangible assets, such as the U.S. dollar, to make them more stable in comparison to other types of cryptocurrencies that derive their value from market demand.

A dozen Republican House members voted against the measure, the passage of which was delayed by GOP-based opposition on Tuesday.

The president met with 11 Republican lawmakers who stopped the measure’s passage and on Tuesday evening announced they reached an agreement to pass the GENIUS Act.

Despite Trump’s announcement, several GOP lawmakers stalled the measure’s passage for nine hours on Wednesday, which delayed its passage to Thursday.

The House also passed the Digital Asset Market Clarity Act of 2025 with a 294-134 vote and the Anti-Central Bank Digital Currency Act with a 219-210 vote.

Those measures go to the Senate for consideration.

The Anti-CBDC Act would ban the Federal Reserve from issuing its own version of a cryptocurrency.

Those who oppose a Federal Reserve-issued digital currency say it would enable the federal government to monitor the currency and track its use.

The Digital Asset Market Clarity Act of 2025 would define digital assets as commodities, securities or stablecoins.

The proposed act also would divide regulatory control of the digital assets between the Commodity Futures Trading Commission and the Securities and Exchange Commission.

House approval of the three measures occurred during what many Republican lawmakers called “crypto week” on Capitol Hill.

July 16 (UPI) — President Donald Trump said he won’t fire Federal Reserve Chairman Jerome Powell but will replace him within the next year when his four-year term ends.

A reporter asked Trump about rumors of his pending firing of Powell while the president fielded media questions prior to a luncheon and meeting with the Bahrain Prime Minister and Crown Prince Salman bin Hamad Al Khalifa at the White House on Wednesday.

“He’s always been too late, hence, his nickname ‘Too Late,'” Trump said of Powell.

“He should have cut interest rates a long time ago,” Trump continued. “Europe has cut them 10 times in the short time that we have cut none.

“The only time he cut them was just before the election to try and help Kamala [Harris], but, obviously, that didn’t work,” Trump said.

“He does a terrible job,” Trump continued. “He’s costing us a lot of money, and we fight through it.”

He said the nation’s economy is strong enough that the Federal Reserve’s lending rate of between 4.25% and 4.5% doesn’t affect the nation.

Instead, Trump said, it hurts those who want to buy a house by saddling them with a higher mortgage rate.

“He’s a terrible Fed chair, Trump said. “I’m surprised that [President Joe] Biden extended him, but they did.”

“We’re not planning on doing anything,” Trump said, but “we’re very concerned.”

Instead of firing Powell, Trump said his administration can “make a change in the next eight months or so.”

Powell initially became the Federal Reserve chairman in 2018 after Trump nominated him for the position during the president’s first term.

Biden nominated Powell for another four-year term, for which he was sworn in on May 23, 2022, and ends on May 15, according to the Federal Reserve.

Trump has denied he is planning to fire Powell, unless evidence of fraud arises, CNBC reported on Wednesday.

But on Tuesday, he asked some House Republicans if he should fire Powell and was told he should, CNBC and The Hill reported.

An unnamed participant said Trump told the group he would fire Powell, media reported.

Trump later denied he would fire Powell and said he has not drafted a letter to remove Powell from his chairmanship.

Trump on Wednesday acknowledged he asked the group of House Republicans “about the concept of firing” Powell, CBS News reported.

He said it only would happen if there were some cause, such as possible fraud involved in a $2.5 billion improvement project for the Federal Reserve headquarters in Washington, D.C.

“He’s already under investigation,” Trump said of Powell. “He spent far more money than he was supposed to rebuilding.”

Office of Management and Budget Director Russ Vought last week accused Powell of undertaking a renovation project that has lasted for years that might run counter to federal law, CBS News reported.

Powell in June told a Senate panel some of the criticisms of the renovation of the Federal Reserve’s Washington, D.C., headquarters are “misleading and inaccurate.”

Trump has criticized Powell for the Federal Reserve not lowering interest rates.

Powell has cited Trump’s often-changing tariff policies as the reason for not lowering the Federal Reserve’s lending rate.

Powell also has said he won’t let politics influence the decisions of the independent Federal Reserve Board of Governors.

July 16 (UPI) — President Donald Trump said a deal has been made with almost all the Republican House members who sank a procedural vote on his cryptocurrency bills Tuesday.

“I am in the Oval Office with 11 of the 12 congressmen/women necessary to pass the Genius Act and, after a short discussion, they have all agreed to vote tomorrow morning in favor of the rule,” Trump said via Truth Social Tuesday.

“Speaker of the House Mike Johnson was at the meeting via telephone, and looks forward to taking the vote as early as possible,” he added.

Two of the bills in question are the aforementioned Genius Act, which would regulate stablecoins and the Clarity Act, which would set rules to decide if an asset is to be regulated as either a security by the Securities and Exchange Commission or as a commodity supervised by the Commodity Futures Trading Commission.

The third bill would stop the creation of a central bank digital currency by the Federal Reserve.

It is unclear what guarantees Trump made to lock in the 11 switched votes of support for the procedural rule.

“I’m thankful for President Trump getting involved tonight,” posted Speaker Mike Johnson, R-La., to X Tuesday, who then declared that the Genius Act will pass when the new vote happens Wednesday.

Shares of stablecoin companies Circle and Coinbase had both dropped Tuesday upon the failure of the procedural vote, as did shares of the digital asset firm MARA Holdings, but all three had upward-heading premarket numbers Wednesday.

July 3 (UPI) — The U.S. economy added seasonally adjusted 147,000 jobs in June despite lower predictions, the Bureau of Labor Statistics said Thursday.

The BLS’ monthly jobs report showed a slight uptick over May’s 139,000 increase. The estimate for the July report was 110,000 nonfarm jobs added.

The unemployment rate dipped to 4.1%, which is lower than the expected increase of 4.3%. The rate that includes discouraged workers and part-time workers slid to 7.7%. There are 7 million unemployed people in the United States. The jobless rate dropped due to fewer workers looking for jobs. The unemployment rate has stayed between 4% and 4.2% since May 2024.

According to the BLS, there were job gains in health care (39,000) and state government, while the federal government keeps losing jobs. The government lost 7,000 jobs in June, and employment is down by 69,000 since its January peak. (Those on paid leave or getting ongoing severance are counted as employed.)

People who work part-time for economic reasons was at 4.5 million, which changed little in June. These are people who want full-time work. Those not in the labor force but who want jobs stayed at 6 million.

The number of discouraged workers, those who believed no jobs were available for them, increased in June to 637,000, an increase of 256,000.

Other major industries, like mining, retail and transportation, showed little change over last month.

In response to the news, the stock market rose Thursday.

“The solid June jobs report confirms that the labor market remains resolute and slams the door shut on a July rate cut,” Jeff Schulze, head of economic and market strategy at ClearBridge Investments, told CNBC. “Today’s good news should be treated as such by the markets, with equities rising despite the accompanying pickup in interest rates.”

The U.S. Federal Reserve is likely to leave interest rates as they are.

June 18 (UPI) — The U.S. Federal Reserve held key interest rates steady Wednesday but said it still sees the possibility of two cuts later this year, with expectations that President Donald Trump‘s tariff policies will spike inflation and slow economic growth.

The Federal Open Market Committee kept its borrowing rate in the 4.25%-4.5% range where it’s been since December.

Earlier Wednesday it had been highly expected that the Fed would leave interest rates unaltered. However, the committee indicated that two cuts by the end of the year were not out of the question, with a chance of four future interest rate cuts being a possibility by 2027.

“The Fed’s main message at the June meeting will be that it remains comfortably in wait-and-see mode,” Bank of America economist Aditya Bhave said in a statement earlier in the day.

The Fed reported on inflation trends and other data in the midst of economic uncertainty.

Economic experts pointed to future so-called “stagflationary” economic pressures with the likelihood of the nation’s GDP pushing at a pace of more than 1% and inflation as high as 3%.

“Uncertainty about the economic outlook has diminished but remains elevated,” according to the FOMC, adding how it was being “attentive to the risks to both sides of its dual mandate.”

The uncertainty stems not only from the unpredictable application of tariffs and ongoing trade volatility caused by them, but also from world events likely to have an effect on U.S. financial markets such as the Iran-Israel war.

“Investors should focus on [Fed Chair Jerome] Powell’s take on the softening labor data, the recent benign inflation prints and the risks of persistent tariff-driven inflation,” Bhave added.

Earlier, Wall Street economists had believed the Fed would keep interest rates in the 4.25% to 4.5% range.

The Fed has not cut interest rates so far during the Trump administration. Despite President Donald Trump aggressively pushing Powell to cut interest rates, he has declined, saying there is too much uncertainty in financial markets, largely because of tariffs that have been imposed and threatened.

June 18 (UPI) — The Mortgage Bankers Association reported that May mortgage demand was down 4.5% year-over-year, despite lower interest rates. Refinance demand was also lower in May.

“Economic uncertainty, rising mortgage rates and increasing competition from growing existing-home sales inventory likely dampened overall demand for new-home purchases in May,” association vice president and chief deputy economist Joel Kan said in a statement.

“Applications to purchase newly built homes fell to their slowest pace in three months as buyers held off on their purchase decisions,” he added. Mortgage applications were down 9% compared with April.

According to the mortgage bankers’ group, new single-family home sales dropped 12.1% from April’s sales level. The association estimated that 631,000 new homes sold in May, compared with 718,000 in April.

Kan said applications to buy newly built homes fell to the lowest level in three months.

The average mortgage loan for new homes was $379,209 in May. In April it was $376,992.

Mortgage loan application volume for the week ending June 13 was down 2.6% from a week earlier, according to the association.

That is despite interest rates dropping to 6.84% for a 30-year fixed loan, the lowest level since April.

Mortgage News Daily CEO Matthew Graham wrote in a statement that what the Federal Reserve does next could cause the mortgage market to react.

“This has nothing to do with ‘cut vs no cut’ (there is zero chance of a rate cut) and everything to do with the other information the Fed presents on announcement days,” Graham wrote. “Of this info, it is the dot plot that carries the most weight.”

The dot chart is the Fed’s rate outlook over several years.