'Not Fair To America,' Says Trump As He Urges 'Too Late' Powell To Cut Rates After April CPI Data

A tamer-than-expected April consumer price inflation (CPI) print sent the broader market higher on Tuesday and bolstered President Donald Trump's call for interest rate cuts.

Trump, who is on an official four-day regional tour of the Middle East, reiterated his view that the Federal Reserve needs to take immediate rate cuts.

Writing on his Truth Social account, the president said, "No Inflation, and Prices of Gasoline, Energy, Groceries, and practically everything else, are DOWN!!!"

The April CPI report showed a smaller-than-expected 0.2% month-over-month increase in consumer prices, underpinned by lower airfare, car and clothing prices. On the other hand, medical care and auto insurance prices continued to rise.

As Trump claimed, egg prices fell from the previous month, although they were up sharply from a year ago. 

The annual CPI rate slowed to 2.3%, marking the smallest increase since February 2021. Lower gasoline prices and unchanged shelter inflation pushed the rate downward.

The annual core CPI, which excludes food and energy prices, remained unchanged at 2.8%, equaling last month's lowest rate since March 2021. 

Commenting on the report, Comerica economist Bill Adams said the April print was good for American consumers, with the rate of price increases slowing to a normal pace this Spring.

Although the economist expects inflation to rise in the second half of the year as businesses pass on tariff costs, he now sees the impact as smaller than it appeared a few weeks ago, thanks to recent trade deals.

Trump called upon the Federal Reserve, led by Chair Jerome Powell, to cut rates even as he attacked the central bank chief.

He said, "THE FED must lower the RATE, like Europe and China have done. What is wrong with Too Late Powell? Not fair to America, which is ready to blossom?"

"Just let it all happen, it will be a beautiful thing!"

This is not the first time Trump has taken cudgels against Powell, who was, incidentally, appointed to the post during the former's first term. While venting his frustrations over Powell's inaction, Trump also signaled that he would move to remove him as the Fed chief.

Powell maintained the Fed's data-dependent stance at the press conference that followed May's rate-setting meeting. "It's not a situation where we can be preemptive, because we actually don't know what the right responses to the data will be until we see more data," he said.

The next meeting is scheduled for June 17-18, when the Fed will also release its Summary of Economic Projections (SEP). 

Following the China trade deal and the tame inflation print, the S&P 500 is back in the black for the year, although trading off its all-time highs.

The SPDR S&P 500 ETF (SPY), an exchange-traded fund (ETF) that tracks the S&P 500 Index, is up about 0.43% for the year, and the Invesco QQQ Trust (QQQ) has gained 1%.

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