Despite hotter-than-expected inflation and growing market wagers on tighter policy, former President Trump continues to pressure the Federal Reserve for lower borrowing costs.

Speaking to reporters on Sunday at the Irish Open, Trump said, "Our country is so powerful, we should be paying the lowest interest rates in the world, no matter what their formula says."

The remarks come at a delicate juncture—just two days after August CPI data showed inflation running above forecasts, prompting traders to sharply boost expectations for a Fed rate hike, with September odds climbing to 86% and markets pricing in two increases by year-end.

When asked whether he expects the Fed to move at next week's meeting, Trump replied, "I don't know."

Trump's pressure campaign extends beyond words. In early September, he floated the idea of severing trade ties with economies running surpluses against the US if the Fed fails to cut rates. On Sunday, when pressed on whether he would follow through, he stated plainly: "Yes, I will do that to certain countries. It will happen gradually over a period of time."

He also added, "I understand formulas better than anyone. With the best credit in the world, we're making other countries rich. We can flip that switch in two minutes."

Fed Chair Facing Growing Rate-Hike Pressure

Fed Chair Warsh now confronts intensifying calls for higher rates. The August CPI surprise has been widely interpreted as a signal for the Fed's first rate increase in three years. While Warsh hasn't drawn the same direct public fire as his predecessor, Trump has noticeably signaled frustration with the Fed's policy stance in recent weeks.

Trump previously criticized former Chair Powell for hesitating to lower borrowing costs more aggressively. Regarding Warsh, he has hinted that the new chair's hands may be tied by what he calls a "highly politicized" Federal Reserve board.

Multiple Pressures Converging on the Fed

The Fed now faces a deeply complex macroeconomic backdrop. The ongoing conflict in the Middle East has entered its seventh month, keeping energy prices elevated. At the same time, Trump's tariff policies continue to add upward pressure on inflation, complicating the central bank's path toward its price stability goal.

On the political front, voters have given low marks to Trump's handling of the war and the economy. Rising living costs—spanning energy, housing, healthcare, and groceries—have become one of the top concerns ahead of November's midterm elections, threatening Republican control of Congress.