Trump Criticizes Warsh After Fed's Unexpected Rate Hike

President Donald Trump has publicly criticized his handpicked Federal Reserve Chair Kevin Warsh for not opposing a recent interest rate hike. On September 16, 2026, the Federal Open Market Committee (FOMC) voted unanimously to raise the federal funds target rate by 25 basis points. In a recent interview, Trump subtly blamed Warsh, stating, "I don't blame Kevin Warsh. I probably would have voted against the board if I were him."

Trump has repeatedly expressed his desire for lower interest rates, even suggesting they should be reduced to 1% or lower. However, the FOMC's decision marked the start of the fourth rate-hiking cycle of the 21st century. The president's policies, particularly his tariff and trade measures and the ongoing Iran war, have contributed to rising consumer prices, making rate cuts unlikely in the near future.

The Iran war has disrupted global energy supply chains, sending fuel prices soaring. U.S. diesel prices hit a record $6.53 per gallon, up from $3.69 a year earlier. This inflationary pressure has forced the Fed to consider more aggressive rate hikes to combat persistently elevated inflation.

Despite his criticism, Trump has expressed continued confidence in Warsh, stating he is "relying on" him. However, the prospect of rate cuts appears to be off the table until after the Iran war concludes.