Senate Majority Leader Chuck Schumer (D-N.Y.) on Thursday accused President Donald Trump of breaking his "day one" promise to lower costs after Labor Department data showed inflation rose in August, and said "Americans know Trump is lying" following Trump's social-media claim of "No Inflation."
Chuck Schumer Links Rising Prices To Trump's Tariffs
On X, Schumer wrote, "Americans know TRUMP IS LYING every time they pay more for coffee, and beef, and rent." His post quoted Trump's Truth Social message from Wednesday, "Just out: No Inflation!!! ‘Too Late' must lower the RATE, BIG, right now. Powell is a total disaster, who doesn't have a clue!!! President DJT."
From the Senate floor, Schumer tied rising prices to tariffs. "Donald Trump, a billionaire, can post on social media that there's ‘no inflation' to his heart's delight, but Americans know he's lying every time they pay more for coffee and beef and rent. And it's all self-inflicted because of these tariffs," he said, adding that Democrats will "force action on legislation stopping these destructive tariffs."
Labor Data Show August Inflation Accelerated Again
The Labor Department reported consumer prices rose 0.4% in August from July and 2.9% year over year, the highest since January, led by a 1.9% jump in gasoline and a 0.6% rise in grocery prices.
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The Federal Reserve is widely expected to cut its key rate by 25 basis points on Sept. 17 as a softer labor market outweighs inflation risks. A Reuters report from Thursday states that most economists even see at least one additional cut by year-end.
Recent data showed hiring slowed in August and a preliminary benchmark revision indicated the U.S. created about 911,000 fewer jobs in the 12 months through March than earlier estimated, prompting some forecasters to pencil in more easing.
Strategists Split Over Aggressive Rate Cuts Now
Meanwhile, Jefferies Chief Market Strategist David Zervos urges the Federal Reserve to consider deeper rate cuts at its upcoming meeting, arguing there's a "very cogent case" for a 75-basis-point move, even though he says it's politically infeasible and "won't even be on the docket."
Economist Peter Schiff, on the other hand, rejects calls for immediate easing, responding to Labor Secretary Chavez-DeRemer's push to "cut those interest rates now" by warning that rate cuts would weaken the dollar, lift consumer prices, push long-term rates higher, and ultimately harm the labor market.
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