The Federal Reserve isn’t budging on interest rates, despite President Donald Trump’s repeated calls for cuts. This ongoing tension is sparking concerns about the future of the Fed’s independence and its role in shaping the economy.

Trump, who nominated current Fed Chair Jerome Powell, has publicly criticized the central bank’s decisions. In a recent post on Truth Social, he accused Powell and his team of mishandling inflation, claiming they’ve failed to address the issue effectively. While Trump hasn’t explicitly stated he’d fire Powell or directly control interest rate decisions, his rhetoric suggests he might push for significant changes to the Fed’s structure.

During his first term, Trump frequently urged the Fed to slash rates, arguing that lower rates would boost the stock market and stimulate borrowing. Lower rates can indeed help the economy in the short term, but they can also fuel inflation, which has already caused headaches for many Americans. Powell, however, remains firm in his stance that the Fed must operate independently, free from political pressure.

In a press conference, Powell declined to respond to Trump’s criticisms, emphasizing that the Fed’s focus is on achieving its dual mandate of price stability and full employment. “The public should be confident that we will continue to do our work as we always have,” he said.

This isn’t the first time a president has clashed with the Fed. In the 1970s, under Fed Chair Arthur Burns, the central bank’s lack of independence contributed to “the Great Inflation,” a period of soaring prices that took years to bring under control. Powell and other experts argue that the Fed’s ability to make tough, data-driven decisions—without political interference—is crucial for long-term economic stability.

If Trump succeeds in undermining the Fed’s independence, it could have far-reaching consequences. Economists warn that such a move could lead to higher inflation, increased borrowing costs, and greater economic uncertainty.

As this standoff continues, all eyes are on whether Trump’s efforts will reshape the Fed—and what that might mean for the future of the U.S. economy.