Trump says he 'loves the inflation' as US prices rise at fastest rate in three years

Trump, a Republican, promised in his 2024 campaign that cutting inflation would be at the heart of his agenda. But his remark on Wednesday appearing to embrace rising prices was seized upon by opponents. Senate Democratic Leader Chuck Schumer posted on X. "His contempt for you knows no bounds."Trump was also criticised last month for saying he was "not even a little bit" influenced by Americans' financial situation when it came to ensuring Iran did not develop nuclear weapons. Higher inflation poses a challenge, too, for Kevin Warsh, the new governor of the Fed, ahead of his first interest rate decision in charge of the central bank next week. When inflation is significantly above the Fed's target rate, the central bank's board of governors typically moves to raise interest rates. This in turn pushes up borrowing costs and restricts the flow of money in the economy, limiting further price hikes and bringing inflation under control. In the run up to Warsh's appointment, Trump repeatedly called on his predecessor, Jerome Powell, and the central bank to cut interest rates. Economists expect rates to remain at their current level, between 3.5% and 3.75%, next month, but warned further evidence of inflation persisting could force the Fed into a rate increase. Stephen Brown, chief North America economist at Capital Economics, said May's rise alone was "not large enough to prove any ammo" to those on the Fed's rate-setting committee who want to push interest rates up.