Former President Donald Trump renewed his calls for interest rate cuts on Monday, asserting that inflation is not a concern amid falling prices across several key sectors.
“Oil prices are down, interest rates are down (the slow moving Fed should cut rates!), food prices are down, there is NO INFLATION,” Trump wrote in a Truth Social post. “The long time abused USA is bringing in Billions of Dollars a week from the abusing countries on Tariffs that are already in place.”
The post follows a fresh wave of tariffs introduced by Trump last week, including a sharp increase in levies on Chinese imports—now totaling 54%. In response, China retaliated by raising its own tariffs by 34%, further escalating trade tensions. Trump criticized China’s response, stating it had long benefited at America’s expense.
“The biggest abuser of them all, China, whose markets are crashing, just raised its Tariffs by 34%… They’ve made enough, for decades, taking advantage of the Good OL’ USA! Our past ‘leaders’ are to blame,” Trump said. He added that he would not pursue a new deal with China unless the trade imbalance is resolved.
Since the announcement of the tariffs, global markets have turned sharply lower. Nasdaq futures have plunged to their lowest levels since January 2024, and Bitcoin briefly dipped below $75,000 early Monday.
Oil markets have also been hit hard. West Texas Intermediate (WTI) crude has dropped 16% over four trading sessions to $60 per barrel, driven by both risk-off sentiment and OPEC’s plan to increase output. Lower oil prices typically contribute to disinflationary pressure in the broader economy.
Trump’s stance on Federal Reserve policy aligns with current market expectations, which are pricing in up to five interest rate cuts in 2025. Many analysts believe rate cuts could cushion the economic impact of prolonged tariff escalation and soften the blow to equity markets.
Over the weekend, Trump reiterated that any future trade agreement with China would depend on resolving the longstanding trade deficit, emphasizing that he’s not willing to negotiate until that issue is addressed.
