Federal Reserve Rate Cut Sparks MAGA Fury: ‘Election Interference’

Donald Trump and other MAGA politicians have expressed their anger at the Federal Reserve lowering interest rates by more than expected so close to an election.

On Wednesday, the Fed cut the benchmark interest rate by half a percentage point to a range of 4.75 percent to 5 percent, the first reduction since the beginning of the coronavirus pandemic. The Fed rate is what U.S. banks pay each other to borrow or loan money, and it also affects the rates on everyday consumer products like credit cards and mortgages.

Republican presidential nominee Trump told reporters that the Fed is “playing politics.”

“I guess it shows the economy is very bad, to cut it by that much, assuming they’re not just playing politics,” he said following the announcement. “The economy would be very bad, or they’re playing politics. But it was a big cut.”

While speaking at a rally in North Carolina, Trump’s running mate, Ohio Senator JD Vance, said the cut “is nothing compared to what American families have been dealing with for the last three years.”

Other Republican figures chimed in. Speaker of the House Mike Johnson said at the Capitol: “The timing is a little suspect. Right on the eve of an election, I don’t know. Count me as curious about it. But it’s welcome news for consumers, we will take it”

“The Fed’s drastic rate cut is so shamelessly political,” Alabama Senator Tommy Tuberville wrote in a post on X. “Our nation’s central bank has no business moving rates this close to an election and is clearly trying to tip the balance in favor of Kamala Harris.”

Conservative writer and television commentator Steve Moore said the severity of the rate cut amounts to political interference.

Speaking on Fox News, he said: “A 50 basis point reduction is putting the pedal to the metal. To do this 50 days from the election – they waited four years to do this.”

“I think a lot of Americans feel like the Fed has politically interfered with this election,” he continued. “This looks like political interference on the part of the Fed to help Kamala Harris over the goal line.”

Newsweek contacted the Fed for comment via email outside of normal working hours.

Is the Rate Cut Political?

In short – no. The Fed is independent of the government’s executive branch, which has no role in setting rates. Chair Jerome Powell is also a Trump appointee, having come into the role in 2018.

However, the strength of the economy is a key issue for voters this November, so a rate cut under this government could be good news for Democratic nominee Kamala Harris – although any impact on voters is likely to be limited.

Matt Willer, managing director at Phoenix Capital Group Holdings, LLC, told Newsweek that a drop in interest rates “won’t be terribly popular with that retiree and savings crowd, but I’m not convinced that the average American correlates interest rates and political elections.”

“The longer-term impact is beneficial to the general public with lower borrowing costs, but that will be tepid traction between now and November,” he explained. “I put little weight into the political influence of the timing and its impact on voters. What may have a greater impact on voters is the underlying cause of the inflationary situation that led to the rise in interest rates.”