Trump Says He Will 'Demand That Interest Rates Drop Immediately'

President Donald Trump took aim at the Federal Reserve and other global financial institutions in his virtual comments Thursday to the World Economic Forum in Davos, Switzerland, calling for immediate cuts to interest rates from the more cautious Fed and international central banks.

"I'll demand that interest rates drop immediately. And likewise, they should be dropping all over the world," Trump said via video to attendees just three days after taking office for his second term. "I'm also going to ask Saudi Arabia and OPEC to bring down the cost of oil."

Trump's demands for lower interest rates and oil prices shook up international markets, as did his long list of grievances against major banks, global financial systems, and even his choice of Jerome Powell to remain as Fed Chair. Powell holds a more deliberate approach to rate cuts.

"I think that a slower pace of cuts really reflects both the higher inflation readings we've had this year and the expectations that inflation will be higher" in 2025," he said last month. "We're closer to the neutral rate, which is another reason to be cautious about further moves."

Trump often clashed with Powell over fiscal policy during his first term, before interest rate hikes were used to reserve surging inflation under former President Joe Biden. As inflation slowed closer to the Fed's target rate of 2%, the FOMC began slowly cutting rates last fall.

The Fed last cut its benchmark rate in December, falling a quarter-percentage point to 4.25% to 4.5%. However, Powell hinted at fewer cuts in 2025 to prevent inflation from flaring up again, a decision that Trump isn't behind. The Fed meets again next week to address interest rate policy.