President Trump acknowledges inflation constraints on Fed policy after 10-year Treasury yields rise 28 basis points in May 2026.
President Trump retreated from demands for Federal Reserve rate cuts as the 10-year Treasury yield climbed to 4.67% on May 19, up from 4.39% in mid-May. Rising oil prices near $100 and persistent inflation have limited the Fed’s ability to ease monetary policy despite earlier White House pressure.
Fed nominee Kevin Warsh now faces an economy where rate cuts could destabilize long-term inflation expectations. The 30-year yield also rose to 5.18%, signaling bond market skepticism about near-term easing. Trump’s shift follows months of signaling Warsh would deliver cheaper borrowing.
In a May 18 interview, Trump stated rate decisions must wait until “the war is over,” marking a departure from his prior insistence on cuts as a “requirement” for the next Fed chair. The White House appears to be aligning with market signals rather than dictating policy.