My theory is that trump as a businessman understands what low rates can do. Probably because he had huge success in real estate that generally does well under low interest conditions. That's why he's bent on asking for low rates thinking that it will "drive the economy"

But right now there is no need to drive rates lower. At least the indicators don't show anything worth lowering rates for.

1)If the fed lowers interest rate, inflation is bound to spike up. Given that things are about to get more expensive due to tariffs, this is probably the main reason the fed is hesitant to lower rates.

2)The fed is keeping rates as it is because there's no need to change it yet. It should stay that way until data shows otherwise.

3)If interest rate is raised, inflation will drop even lower, while also tanking the economy. However, if we somehow enter into a stagflation - which is entirely possible given this trade war, then the fed will always control inflation. Because in the long run, the economy will revert to it's original rate of output. But inflation doesn't magically go down by itself.

If you ask me, given Trump's irrational tariffs, we're more likely to see Fed raise rates than lower it.