Trump Wants Cheaper Money Now — Even If the Fed Isn’t Ready

Axios, CNN, and Reuters contributed to this report.

Interest rate cuts from the Federal Reserve aren’t coming fast enough for President Donald Trump. So instead of waiting on the central bank, he’s trying to force the issue himself — using executive power, public pressure and a string of headline-grabbing proposals aimed squarely at lowering borrowing costs for everyday Americans.

At the heart of Trump’s latest affordability push is a simple message: mortgages and credit cards are too expensive, and Washington needs to do something about it — now. What’s less clear is whether the tools he’s using will actually deliver meaningful relief, or whether they’ll create new problems in the process.

Traditionally, interest rates are the Fed’s domain. But Trump has never been shy about challenging the central bank, and his latest moves amount to a direct attempt to sidestep it altogether.

In recent days, Trump announced two major steps — both via Truth Social — designed to make borrowing cheaper without waiting for Congress or the Fed to act.

First, he ordered government-backed mortgage giants Fannie Mae and Freddie Mac to buy up $200 billion worth of mortgage-backed securities. The idea is straightforward: more demand for mortgage bonds should push mortgage rates down, making home loans more affordable.

Markets reacted quickly. Mortgage rates dipped below 6% last week for the first time since 2023, offering a glimmer of relief for would-be homebuyers. It’s a real move, but economists caution it may be short-lived and limited in scope.

Second, Trump declared that credit card interest rates should be capped at 10% for one year starting next week. That announcement made waves — and raised eyebrows. It’s not clear what legal authority he’s relying on, or whether banks would comply without legislation or formal regulation.

In effect, Trump is trying to lower borrowing costs by decree — a bold move that underscores just how frustrated the White House is with stubbornly high prices and interest rates.

On the surface, lower rates sound like a win for consumers. Cheaper mortgages could help unlock the frozen housing market. Lower credit card rates could free up cash for families struggling with debt.

But economists and bankers warn that the picture isn’t so simple.

On housing, lower mortgage rates can actually keep prices elevated by boosting demand without increasing supply. That’s exactly what happened during the ultra-low-rate era of 2020 and 2021, when bidding wars exploded and home prices surged. Without more homes being built, cheaper loans alone won’t fix affordability — and could even make it worse.

The credit card cap raises even bigger concerns.

Economists at Morgan Stanley warned this week that while lower rates might reduce monthly interest payments, the negative effects would likely outweigh the benefits. Banks, they argue, would respond by cutting credit limits, pulling credit lines or denying cards altogether — especially for borrowers with lower credit scores.

That could push people toward more expensive alternatives like payday loans, or force them to slash spending entirely.

Citigroup CFO Mark Mason echoed that warning, saying a rate cap would likely slow the economy significantly. The banking industry has been even more blunt, arguing that such a cap would “reduce credit availability and be devastating” for millions of families and small businesses.

There’s also the question of whether Trump can actually do any of this on his own.

Experts say a credit card rate cap would almost certainly require congressional approval. One possible route would be through the Consumer Financial Protection Bureau — but Trump has spent much of his presidency trying to weaken or defund the agency.

Ironically, the idea of a credit card cap has strong backing from figures Trump often criticizes. Senators Bernie Sanders and Elizabeth Warren have pushed similar proposals for years, along with progressive Democrats and a handful of populist Republicans like Sen. Josh Hawley.

Even so, GOP leadership remains skeptical. Senate Majority Leader John Thune made clear he’s not on board, warning about reduced access to credit.

The rate push is just one piece of a broader affordability campaign Trump has launched ahead of the 2026 election cycle.

He’s floated banning large institutional investors from buying single-family homes, redirecting health care subsidies directly to consumers, forcing tech companies to cover energy costs tied to data centers, negotiating drug prices, and even sending $2,000 tariff rebate checks to Americans.

More announcements are coming, Trump says, including a major housing affordability framework he plans to unveil at the World Economic Forum in Davos.

Critics argue many of these ideas are vague, legally shaky or economically symbolic rather than substantive. Supporters say they show a president trying — aggressively — to respond to voters who are fed up with high costs.

Trump is pushing harder than any president in decades to directly influence borrowing costs, effectively challenging the Fed’s dominance over interest rates. It’s a risky strategy that reflects both political urgency and economic frustration.

Some of his moves, like nudging mortgage rates lower, may offer modest relief. Others, like a unilateral credit card rate cap, could backfire by choking off access to credit and slowing the economy.

For now, one thing is clear: Trump isn’t waiting patiently for interest rates to fall. Whether his do-it-yourself approach to cheaper money helps consumers — or creates new headaches — is a question the economy will answer soon enough.