STORY: U.S. President Donald Trump said this week that the Federal Reserve should set its benchmark interest rate at 1% to lower government borrowing costs, allowing the administration to finance the high and rising deficits expected from his spending and tax-cut bill.

Former Treasury Secretary Lawrence Summers warned that President Donald Trump’s bid to assert control over the Federal Reserve and drive down interest rates could trigger a surge in inflation expectations that pushes up long-term borrowing costs.

Trump questions Fed Chair Powell’s tenure, hints fraud, yet experts view removal improbable due to legal constraints.

The Bureau of Labor Statistics on Tuesday released June inflation data, showing prices increased from the prior month. Hours later, President Trump called on the Fed to lower rates.

Inflation is up, stocks are down, and more tariffs are on their way. Trump wants interest rates to come down but the direction of travel is making it less likely that the Fed will deliver the cuts he wants. It’s not clear whether Trump can extract himself from the policy cycle he has created.

A top White House budget official said President Trump is "troubled" by Federal Reserve chair Jerome Powell's management, as Mr. Trump pressures him over interest rates.

Airline sector shows resilience with strong demand and positive earnings, indicating robust consumer and corporate spending despite earlier geopolitical concerns. Netflix reporting after close, remains a streaming leader, but valuation concerns persist; overall, stocks continue mild melt-up with benign retail and jobless data supporting stability.

A Fed policy rate that low is not typically a sign that the U.S. is the "hottest" country in the world for investment, as Trump has said.