Trump calls again on Federal Reserve chair Jerome Powell to lower interest rates
Donald Trump has – once again – called on Jerome Powell, the Federal Reserve chair, to lower interest rates, noting that payroll processing firm ADP reported that job creation slowed in May.
In the post on his Truth Social platform, he said that Powell – who in the past he has called a “major loser” – is “unbelievable”.
ADP NUMBER OUT!!! “Too Late” Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES!
ADP’s report showed private payrolls ticked up by only 37,000 in May – far below the Dow Jones forecast for 110,000 – and mark the lowest monthly reading from ADP since March 2023.
At a meeting with Trump at the White House last week, Powell had pushed back against the president’s demands, telling him “that the path of policy will depend entirely on incoming economic information and what that means for the outlook,” according to an unusually blunt statement issued by the central bank.
Trump, who has attacked Powell repeatedly over the Fed’s decision to not lower interest rates, recently said he has no intention of trying to fire Powell. But the possibility of a firing has unsettled financial markets that bank on an independent Fed’s ability to do its job without political interference.
Earlier this month, Powell kept interest rates on hold and cautioned that the president’s tariff regime was likely to raise prices, weaken growth and increase unemployment in the US if maintained.
The statement went on to say that Powell maintained that the Fed “will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis”.
The full statement read:
At the President’s invitation, Chair Powell met with the President today at the White House to discuss economic developments including for growth, employment, and inflation.
Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook.
Finally, Chair Powell said that he and his colleagues on the FOMC will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis.
Key events
Mexico will respond if there is no agreement with US on ‘unfair’ metals tariffs, says president
Mexico will announce measures next week if there is no agreement reached with the United States on the steel and aluminum tariffs announced, president Claudia Sheinbaum has said.
She also called the US announcement to raise the metals’ tariffs an “unfair measure” during her morning conference, and added that Mexico’s answer will not be “an eye for an eye”.
Trump’s ‘big, beautiful bill’ will add $2.4tn to national debt, according to nonpartisan analysis
The nonpartisan Congressional Budget Office has released a revised estimate of the cost of Donald Trump’s tax and spending cut bill passed by the House of Representatives, concluding it will add $2.4tn to the federal government’s $36.2tn debt.
The new assessment comes a day after Elon Musk blasted the bill as a “disgusting abomination”, emboldening GOP deficit hawks who have been pushing back against the measure.
An earlier CBO estimate predicted the bill, which passed through the House on 22 May by a single vote and with no Democratic support, would add around $3.8tn to Washington’s debt over the next decade.
The measure, now under consideration in the Senate, aims to extend Trump’s 2017 tax cuts while also achieving steep spending reductions to pay for them, largely – and highly controversially – on Medicaid.
The new CBO estimate takes into account late changes that were made to the bill as Republican leaders steered it to passage.
UAE seeks US trade deal to roll back Trump’s steel and aluminum tariffs – Reuters
The United States and the United Arab Emirates have agreed to start negotiations for a potential bilateral trade agreement that could ease tariffs on the Gulf state’s steel and aluminum industry, four people familiar with the matter have told Reuters.
Emirati officials discussed the possibility of a trade agreement with US counterparts during Donald Trump’s two-day visit to Abu Dhabi last month, the sources said.
The Office of the US Trade Representative did not respond to a Reuters request for comment. Neither did Emirati officials.
Like other nations, the UAE has been hit by Trump’s 10% baseline tariff on its exports to the US. But its steel and aluminum products have also been hit by a 25% tariff that the Trump administration is now doubling to 50%.
While the UAE is a major oil producer, its steel and aluminium products are significant non-oil exports. In 2024, the UAE was the second-largest steel and aluminium exporter to the US, accounting for 8% of total US consumption, data shows.
In Abu Dhabi, Emirati officials highlighted to American counterparts comprehensive trade deals that it had signed with other countries over the past three years, the sources said, to illustrate that the UAE was capable of moving quickly on trade talks.
The sources said that US officials had responded positively, although it was unclear when talks would start. Two of the sources said Washington was likely to negotiate a limited deal that would fall short of a comprehensive free trade pact.
The UAE is Washington’s biggest trade partner in the Middle East, according to the Gulf state’s foreign ministry. Bilateral trade in 2024 was valued at $34.4bn, according to US trade data, with the US enjoying a $19.4bn surplus.
The Gulf state, which is reliant on the US security umbrella, has pledged to invest $1.4tn in the US over the next decade. Its sovereign wealth funds, including Abu Dhabi’s $330bn Mubadala, are already big US investors, and Trump and his family have business interests in the UAE.
Republican allies close to the White House are privately arguing that Elon Musk’s bombshell attacks on the spending megabill stem from the fact that it harms the tech billionaire’s business interests, according to Politico.
“The West Wing is perplexed, unenthused, and disappointed” with Musk, who left the White House to attend to his ailing business empire, one White House official told the news outlet, which reports that a push is now underway among Republicans close to the White House to reframe Musk’s criticisms of the “big, beautiful bill” as self-serving.
“When businessmen criticize legislation, journalists don’t take them at their word, they look at how the legislation would impact their business interests,” said one Republican close to the White House. “They should be doing that in this case.”
Indeed Tesla benefitted from the Biden-era EV support package which included multiple federal tax credits, which the “big, beautiful bill” strips away, as was noted by House speaker Mike Johnson yesterday. He told reporters:
It’s not personal. I know that the EV mandate [is] very important to [Musk] — that’s going away, because the government should not be subsidizing these things as part of the Green New Deal … And I know that has an effect on his business, and I lament that.
Deadline arrives for ‘best offers’ from US trading partners to avoid tariffs
Today is the White House’s deadline for countries to submit their “best offers” in trade negotiations with the US in order to avoid being slapped with steep tariffs in July.
White House press secretary Karoline Leavitt confirmed yesterday that the Trump administration had sent letters to trading partners to push for offers by today as the deadline approached, underlining Trump’s use of tariffs as a negotiating tool.
“This letter was simply to remind these countries that the deadline is approaching and the president expects good deals, and we are on track for that,” she told reporters.
Reuters first reported on the office of the US trade representative’s letter seeking to accelerate unwieldy talks with multiple partners ahead of the Trump administration’s self-imposed deadline in under five weeks.
Those negotiations kicked off on 9 April when he paused his so-called “Liberation Day” tariffs for 90 days until 8 July amid stock, bond and currency markets turmoil over the sweeping levies.
While over the last few months Trump and his administration officials have boasted about the number of countries reaching out to discuss trading arrangements and have even claimed that several agreements are close to being over the line, they have also admitted that talks have been slow-moving and they don’t have the capacity to negotiate with so many countries at once.
The US has so far only reached a framework agreement with the UK, and an agreement with China that both countries are now accusing each other of reneging on.
Trump officials delayed – and redacted part of – farm trade report over deficit forecast – Politico
Trump administration officials delayed and redacted a government forecast because it predicts an increase in the nation’s trade deficit in farm goods later this year, two people familiar with the matter have told Politico, in a story that could raise questions about potential political interference in government reports that present “politically inconvenient” data.
Here’s an extract from Politico’s story:
The numbers run counter to Donald Trump’s messaging that his economic policies, including tariffs, will reduce US trade imbalances. The politically inconvenient data prompted administration officials to block publication of the written analysis normally attached to the report because they disliked what it said about the deficit.
The highly unusual rollout could raise questions about potential political meddling with government reports that have traditionally been trusted for decades.
“Objectivity is really key here and the public depends on it,” said Joe Glauber, a former USDA chief economist. “To lose that trust would be terrible.”
A USDA spokesperson blamed the delay on an internal review.
“The report was hung up in internal clearance process and was not finalized in time for its typical deadline,” said USDA spokesperson Alec Varsamis in a statement. “Given this report is not statutory as with many other reports USDA does, the Department is undergoing a review of all of its non-statutory reports, including this one, to determine next steps.”
It’s not clear when or if the written analysis portion will be released.
Trump calls again on Federal Reserve chair Jerome Powell to lower interest rates
Donald Trump has – once again – called on Jerome Powell, the Federal Reserve chair, to lower interest rates, noting that payroll processing firm ADP reported that job creation slowed in May.
In the post on his Truth Social platform, he said that Powell – who in the past he has called a “major loser” – is “unbelievable”.
ADP NUMBER OUT!!! “Too Late” Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES!
ADP’s report showed private payrolls ticked up by only 37,000 in May – far below the Dow Jones forecast for 110,000 – and mark the lowest monthly reading from ADP since March 2023.
At a meeting with Trump at the White House last week, Powell had pushed back against the president’s demands, telling him “that the path of policy will depend entirely on incoming economic information and what that means for the outlook,” according to an unusually blunt statement issued by the central bank.
Trump, who has attacked Powell repeatedly over the Fed’s decision to not lower interest rates, recently said he has no intention of trying to fire Powell. But the possibility of a firing has unsettled financial markets that bank on an independent Fed’s ability to do its job without political interference.
Earlier this month, Powell kept interest rates on hold and cautioned that the president’s tariff regime was likely to raise prices, weaken growth and increase unemployment in the US if maintained.
The statement went on to say that Powell maintained that the Fed “will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis”.
The full statement read:
At the President’s invitation, Chair Powell met with the President today at the White House to discuss economic developments including for growth, employment, and inflation.
Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook.
Finally, Chair Powell said that he and his colleagues on the FOMC will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis.
White House restores legal status of child with life-threatening illness
Dani Anguiano
The Trump administration has reversed its decision to revoke the legal status of a four-year-old girl, receiving continuing life-saving treatment in the US, and her family after a national outcry.
Deysi Vargas, her husband and their daughter – whom lawyers identified by the pseudonym Sofia – had come to the US in 2023 to seek medical care for their daughter who has a rare condition that requires specialized treatment. But in April, the federal government ended their humanitarian parole, a temporary status granted to people on urgent humanitarian grounds, and ordered them to “self-deport”.
Sofia’s doctors warned that she would likely die “within days” if forced to return to Mexico and her family and attorneys fought the deportation order, describing it as unlawful and “a cruel betrayal of our nation’s values”.
Her case, which an attorney for the family said highlighted “the recklessness of this administration’s deportation policies”, sparked outrage and a significant response from Democratic lawmakers. Dozens of representatives and both of California’s senators, Adam Schiff and Alex Padilla, signed a letter urging the Department of Homeland Security to extend the family’s legal status.
“We believe this family’s situation clearly meets the need for humanitarian aid and urge you and this Administration to reconsider its decision. It is our duty to protect the sick, vulnerable, and defenseless. Without action, S.G.V. will die,” the lawmakers wrote.
The Los Angeles Times first reported on Tuesday that the administration had restored legal status for the family, sending a letter on Monday that stated: “This is to advise you that effective June 2, 2025, you have been granted Humanitarian Parole for a period of one year.”
Andrew Roth
An evangelical leader and adviser to Donald Trump on interfaith issues has been appointed the new head of the Gaza Humanitarian Foundation (GHF) as the controversial US- and Israeli-backed initiative attempts to recover from top-level resignations during a tumultuous rollout last week.
Johnnie Moore, a member of the US Commission on International Religious Freedom and founder of the boutique advisory firm Kairos Company, was appointed the new head of the GHF after Jake Wood, a former marine, resigned, saying that he could not guarantee the GHF’s independence from Israeli interests.
Moore has been a vocal defender of the GHF who has bristled at public criticism of the rollout, telling the UN chief, António Guterres, on X that reports of Palestinians killed and injured while seeking aid in Gaza was “a lie … spread by terrorists”.
Major partners continue to abandon the GHF, which was launched with vocal support from US government officials. Boston Consulting Group (BCG), a US consulting firm, said it had cancelled its contract with the GHF on Tuesday amid growing media scrutiny into the group’s work and sources of funding.
Global trade tensions could disrupt ocean goods trade and will push up the price of seafood in the United States, a major importer of fish, according to a report from the United Nations trade agency published on Wednesday.
President Donald Trump has imposed 10% tariffs on nearly all seafood, with China facing tariffs of 30%, according to the report by the UN Trade and Development agency.
“Prices on fish products are likely to rise due to limited capacity to scale up local production,” the report found.
Wild fish stocks in the US are limited due to overfishing and it takes time to scale up domestic aquaculture production, the report said. For example, salmon farms have a three-year production cycle.
The US exports $4.5bn and imports $16bn worth of fish each year, according to UNCTAD data.
Brazil, which exports 55% of its primary fish products to the US, and China, is likely to redirect its seafood to domestic markets or alternative trading partners, UNCTAD predicted.
US immigration officials push for increased detentions, including ‘collateral’ arrests
José Olivares
Senior US immigration officials over the weekend instructed rank-and-file officers to “turn the creative knob up to 11” when it comes to enforcement, including by interviewing and potentially arresting people they called “collaterals”, according to internal agency emails viewed by the Guardian.
Officers were also urged to increase apprehensions and think up tactics to “push the envelope” one email said, with staff encouraged to come up with new ways of increasing arrests and suggesting them to superiors.
“If it involves handcuffs on wrists, it’s probably worth pursuing,” another message said.
The instructions not only mark a further harshening of attitude and language by the Trump administration in its efforts to fulfill election promises of “mass deportation” but also indicate another escalation in efforts, by being on the lookout for undocumented people whom officials may happen to encounter – here termed “collaterals” – while serving arrest warrants for others.
The emails, sent by two top Immigration and Customs Enforcement (Ice) officials this past Saturday, instructed officers around the country to increase arrest numbers over the weekend. This followed the Department of Homeland Security secretary, Kristi Noem, and the White House deputy chief of staff, Stephen Miller, pressing immigration officials last month to jack up immigration-related arrests to at least 3,000 people per day.
Dani Anguiano
US immigration authorities have taken into custody the family of Mohamed Sabry Soliman, the man who allegedly used a flamethrower to attack a Colorado rally for Israeli hostages, the Department of Homeland Security said on Tuesday.
Twelve people were wounded in Boulder on Sunday when the 45-year-old allegedly used incendiary devices to attack people demonstrating for the release of hostages in Gaza in what the FBI has deemed an “act of terrorism”. During the attack, Soliman allegedly targeted Zionists and shouted “Free Palestine”.
The Trump administration quickly seized on Soliman’s immigration status to push its mass deportation agenda. Soliman, who was born in Egypt, was in the US on an expired tourist visa after entering the country in 2022. He applied for asylum that year and received work authorization that later expired, Tricia McLaughlin, the DHS assistant secretary said. Donald Trump has blamed the attack on his predecessor, arguing it was the result of Joe Biden’s “ridiculous Open Border Policy”.
Kristi Noem, the Department of Homeland Security secretary, announced on Tuesday that immigration agents were taking Soliman’s wife and five children into custody, and that federal officials are investigating whether his family knew about his plans.
Soliman has said he acted alone, and told police “no one knew about his plans”, according to a state arrest affidavit.
Michael Savage
The BBC has defended its reporting on the war in Gaza and accused the White House of misrepresenting its journalism after Donald Trump’s administration criticised its coverage of a fatal attack near a US-backed aid distribution site.
Senior BBC journalists said the White House was political point-scoring after Trump’s press secretary, Karoline Leavitt, accused the corporation of taking “the word of Hamas with total truth”. She also falsely claimed that the BBC had removed a story about the incident.
Leavitt launched her attack on the BBC after being asked about reports that Israeli forces opened fire near an aid distribution centre in Rafah. Brandishing a print-out of images taken from the BBC’s website, she accused the corporation of having to “correct and take down” its story about the fatalities and injuries involved in the attack.
The Hamas-run health ministry had said at least 31 people were killed in the gunfire. The International Committee of the Red Cross (ICRC) later said at least 21 Palestinians were killed by IDF troops.
In a briefing on Tuesday, Leavitt said: “The administration is aware of those reports and we are currently looking into the veracity of them because, unfortunately, unlike some in the media, we don’t take the word of Hamas with total truth. We like to look into it when they speak, unlike the BBC.
“And then, oh, wait, they had to correct and take down their entire story, saying: ‘We reviewed the footage and couldn’t find any evidence of anything.’”
The BBC swiftly issued a robust statement. It said that casualty numbers were updated throughout the day from multiple sources, as is the case of any incident of the kind in a chaotic war zone. It also clarified that the accusation from Leavitt that the BBC had removed a story was false.
“The claim the BBC took down a story after reviewing footage is completely wrong,” it said. “We did not remove any story and we stand by our journalism.
David Smith
The far-right congresswoman Marjorie Taylor Greene has assembled a “rogues’ gallery of extremists, conspiracy theorists and C-team political operatives” to promote Donald Trump’s crackdown on non-government organisations (NGOs), a congressional watchdog has claimed.
The House of Representatives’ Delivering on Government Efficiency (Doge) subcommittee, chaired by Greene, is due to hold a hearing on Wednesday entitled “Public Funds, Private Agendas: NGOs Gone Wild”.
The subcommittee said in a press release that the hearing will “expose” the use of federal funds by NGOs to advance “radical” agendas such as “open borders and the Green New Deal scam”. It frames its work as an investigation of the alleged funneling of taxpayer dollars to politically motivated groups while “lining the pockets of their friends and allies”.
But a memo from the Congressional Integrity Project (CIP), obtained by the Guardian, condemns the hearing as “political theater”, “weaponized government oversight” and an exercise in hypocrisy, given the substantial federal funding received by Republican allies and rightwing groups.
While attacking civil society organisations for receiving federal grants, the memo says, “their own networks have systematically benefited from government contracts, subsidies, and loans worth billions of dollars”.
Donald Trump said on Wednesday that Chinese President Xi Jinping is tough and “extremely hard to make a deal with,” days after the US president accused China of violating an agreement to roll back tariffs and trade restrictions.
“I like President Xi of China, always have, and always will, but he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH,” Trump said in a post on Truth Social.
White House press secretary Karoline Leavitt had said on Monday that Trump would speak with Xi this week as the two leaders seek to iron out differences on last month’s tariff agreement in Geneva, among larger trade issues.
Higher US metals tariffs kick in as deadline for ‘best offers’ arrives
Washington doubled its tariffs on steel and aluminium imports on Wednesday, when president Donald Trump’s administration also expects trading partners to make “best offers” to avoid other punishing import levies from taking effect in early July.
Maroš Šefčovič, the trade negotiator for the European Union, met US trade representative Jamieson Greer in Paris on Wednesday, with the 27-nation bloc set to make its case for cutting or eliminating threatened tariffs on European imports, Reuters reported.
Late on Tuesday, Trump signed an executive proclamation that activates from Wednesday a hike in the tariffs on imported steel and aluminium to 50% from the 25% rate introduced in March.
“We started at 25 and then after studying the data more, realized that it was a big help, but more help is needed. And so that is why the 50 is starting tomorrow,” White House economic adviser Kevin Hassett told a steel industry conference in Washington on Tuesday. The increase came into effect at 12.01am.
The increase applies to all trading partners except Britain, the only country so far that has struck a preliminary trade agreement with the US during a 90-day pause on a wider array of Trump tariffs. The rate for steel and aluminium imports from the UK – which does not rank among the top exporters of either metal to the US – will remain at 25% until at least 9 July.
Elon Musk calls Trump’s ‘big, beautiful’ tax bill a ‘disgusting abomination’
Good morning and welcome to the US politics live blog. I’m Tom Ambrose and I will be bringing you all the latest news lines over the coming hours.
We start with news that Elon Musk, the billionaire tech entrepreneur, opened a new rift with Donald Trump by denouncing the US president’s tax and spending bill as a “disgusting abomination”.
Musk’s online outburst could embolden fiscally conservative Republican senators – some of whom have already spoken out – to defy Trump as they continue crucial negotiations on Capitol Hill over the so-called “one big, beautiful bill”.
“I’m sorry, but I just can’t stand it anymore,” Musk wrote on his X social media platform on Tuesday. “This massive, outrageous, pork-filled Congressional spending bill is a disgusting abomination. Shame on those who voted for it: you know you did wrong. You know it.”
Musk, who had previously voiced criticism of the proposed legislation, quipping that it could be big or beautiful but not both, added on X: “It will massively increase the already gigantic budget deficit to $2.5 trillion (!!!) and burden America citizens with crushingly unsustainable debt.”
He continued: “Congress is making America bankrupt.”
A top donor to Trump during last year’s election campaign, Musk departed the White House last week after steering its so-called “department of government efficiency” (Doge) with the stated mission of slashing fraud and abuse within federal departments. He has argued that the Republican bill will undermine Doge’s work and drive the US further into debt.
For the full report, see here:
In other developments:
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Republican firebrand Marjorie Taylor Greene has drawn widespread criticism from Democratic colleagues for admitting that not only did she not read Donald Trump’s tax and spending bill before voting for it, but she would have voted against it had she read thoroughly.
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The White House gloated on social media about the arrests of the wife and five children of Mohamed Sabry Soliman, the suspected Boulder attacker, and joked about providing them with “six one-way tickets”.
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In the 48 hours since the firebomb attack in Boulder, Colorado, on a demonstration in support of Israelis held hostage in Gaza, Republicans politicized the attack, attempting to blame Democrats, including the state’s multiple Jewish leaders.
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Democrats denounced the Trump administration’s “cruel” decision to rescind health department guidance issued in the wake of the 2022 Dobbs decision, striking down the right to an abortion, that required hospitals to provide abortions to women in medical emergencies even in state’s with local bans on the procedure.
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Millions of legal immigrants may be left unable to work after the US Social Security Administration quietly instituted a rule change to stop automatically issuing them social security numbers.
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A US judge on Tuesday ruled the US Bureau of Prisons must keep providing transgender inmates gender-affirming care, despite an executive order Donald Trump signed on his first day back in office to halt funding for such care.
