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Fed's Rate Hike Complicates Trump's Midterm Economic Message
Confirmed
In Short: The Federal Reserve's recent rate hike, aimed at curbing inflation, may undermine President Trump's promise of a $5,000 'Trump dividend' to Americans if Republicans win the midterms.
However, the Fed's decision to raise interest rates, designed to combat inflation, will make borrowing more expensive for voters. This move delivers a significant blow to Trump's economic promises with less than two months until the midterm elections.
Meanwhile, the Supreme Court has delivered major blows to President Trump and his fellow Republicans, suggesting the justices will not be receptive to last-minute efforts to change election rules heading into the midterms. With some states already sending out ballots for the midterm elections, timing was an issue for Republicans in both cases.
What's confirmed
- However, the Fed's decision to raise interest rates, designed to combat inflation, will make borrowing more expensive for voters. This move delivers a significant blow to Trump's economic promises with less than two months until the midterm elections.
- Meanwhile, the Supreme Court has delivered major blows to President Trump and his fellow Republicans, suggesting the justices will not be receptive to last-minute efforts to change election rules heading into the midterms. With some states already sending out ballots for the midterm elections, timing was an issue for Republicans in both cases.
What's still developing
- By Paul Cuno-Booth, D'Angelo Gore, Robert Farley, Lori Robertson, Jessica McDonald and Kate Yandell In a nearly two-hour speech at the first Republican midterm convention, President Donald Trump promised to pay Americans if Republicans won, and he repeatedly said communists could take over Congress if they didn’t, among other familiar claims.
- Some election-law experts, however, told The New York Times that Trump’s promise is probably close enough to a pledge to cut taxes or enact other economic policies that will financially benefit voters to pass muster; a 1982 Supreme Court decision considers such promises protected political speech.
- Trump promised every American adult a $5,000 check if Republicans win in November, framing it as a “dividend” from his administration’s economic policies.
- The Fed chairman was later asked what message he had for Trump, who has repeatedly called for lower rates.
- Although the president appoints members of the Fed’s Board of Governors, the FOMC is designed to make rate decisions based on economic conditions rather than political pressure.
- Bennett, CQ Roll Call’s White House correspondent, talks about his recent trip with the travel pool to Dallas and the “surrealism” surrounding the two-day Republican midterm convention.
- Speaking at the St. Petersburg International Economic Forum, Putin described Zelenskyy’s open letter proposing the meeting as “boorish,” particularly after a May 22 drone attack on a college dormitory in the Russian-controlled Luhansk region that Moscow said killed 21 and wounded scores of others.
- The letter is the first public message Ukrainian President Volodymyr Zelenskyy has written directly to Russian President Vladimir Putin since Russia launched its full-scale invasion in 2022.