President-elect Donald Trump has pledged to cut interest rates, but the path to getting there is largely beyond his influence. While Trump has criticized the Federal Reserve’s management of rates, economic experts point out that mortgage and loan rates are set by broader financial markets and long-term risks like inflation, not by presidential directives.

Trump’s efforts to pressure the Fed include harsh criticism of Fed Chairman Jerome Powell, whom he cannot fire without legal cause. Trump has suggested he could influence the Fed by appointing a “shadow” person or replacing Powell when his term ends in 2026. However, Trump’s plans to impose new tariffs or implement Tax cuts could increase inflation, which could lead to higher rates.

Experts suggest that keeping inflation stable and stabilizing the national debt are the most effective ways to support lower interest rates over the long term – a challenge that requires bipartisan action.

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