2,044 events on record Subscribe September 10, 2026
Standing Record home The Standing Record A non-partisan record of US democratic norms —
and the events that erode them.

Trump threatened to halt trade with U.S. deficit countries unless the Federal Reserve lowered interest rates

President Trump posted on Truth Social on September 4, 2026, that he would halt trade with countries running a deficit with the United States -- including Canada, Mexico, European Union nations, and China -- unless the Federal Reserve cut interest rates, citing a Supreme Court tariff ruling as giving him "an absolute right" to condition trade this way. The threat extended a monthslong pressure campaign against the Fed's independence that has already included the removal of a Fed governor and a criminal probe of the former Fed chair. Trump said he speaks regularly with Kevin Warsh, the Fed chair he selected to succeed Jerome Powell.

Jurisdiction
Federal
Location
Washington, D.C.

Abuses documented

Actors

On September 4, 2026, President Trump posted on Truth Social that he would halt trade with countries running a deficit with the United States unless the Federal Reserve lowered interest rates, writing "LOWER THE RATE OR I'LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT," and naming Canada, Mexico, European Union nations, and China among the trading partners affected. Trump cited a Supreme Court ruling on his tariff authority as having "strongly acknowledged" that he has "an absolute right" to condition trade this way, and pointed to a stronger-than-expected August jobs report as evidence the economy could tolerate lower rates.

The threat extended a monthslong campaign by Trump to bend the Federal Reserve's interest-rate decisions to his preference, an institution Congress has insulated from day-to-day political control specifically so monetary policy does not answer to a president's demands. Earlier steps in that campaign included the August 2025 removal of Fed Governor Lisa Cook over a disputed mortgage-fraud allegation, a subsequent DOJ emergency Supreme Court petition seeking to lift injunctions blocking that removal, and a January 2026 DOJ criminal investigation of then-Chair Jerome Powell that a federal judge quashed after finding "essentially zero evidence" of wrongdoing.

Trump told reporters in the Oval Office that he speaks regularly with Kevin Warsh, the Fed chair he selected to succeed Powell, though it was not confirmed the two discussed the threat itself. The Federal Reserve declined to comment on Trump's post. Fed officials were divided ahead of a September 15 policy meeting on whether to raise rates in response to inflation data, with Governors Michael Barr and Christopher Waller both indicating they could support an increase if inflation showed no further progress toward the Fed's 2% target.

Why we recorded this

Central bank independence exists so interest-rate decisions answer to economic conditions, not to a president's political demands. Trump publicly conditioned U.S. trade policy toward multiple sovereign trading partners on the Federal Reserve cutting rates, using his tariff authority as leverage over a decision the Fed alone is supposed to make. This archive records the threat because using one executive power to coerce an independent agency's core function is how that independence erodes in practice, not by statute.

Sources

  1. Trump threatens to halt some trade unless the Fed cuts rates — The New York Times (via The Philadelphia Inquirer) primary accessed September 5, 2026
  2. Trump says he will cease trading with top partners unless Fed lowers rates — CNN investigative accessed September 5, 2026

See also