United States reserve balances with Federal Reserve Banks: USD 3.000T, previous USD 3.209T

United States reserve balances with Federal Reserve Banks: USD 3.000T, previous USD 3.209T

The Federal Reserve has faced a wave of criticism and scrutiny in recent weeks, with President Trump publicly expressing dissatisfaction with its current policies and billionaire Elon Musk hinting at an investigation into the central bank's spending. These developments have added to the uncertainty surrounding the Federal Reserve's role in the U.S. economy.

President Trump, during a rally in Michigan, criticized the Federal Reserve for its approach to interest rates, suggesting that he possesses greater expertise in this area than the current Fed leadership [1]. His comments, directed at Fed Chairman Jerome Powell, come amidst concerns of potential economic slowing, as new inflation and GDP data are anticipated. Despite previously assuring investors that he had no plans to remove Powell, Trump has continued to express dissatisfaction, recently labeling Powell a "major loser" in a social media post.

Elon Musk, whose Department of Government Efficiency (DOGE) has imposed a dramatic series of cuts to the federal government since January, has also targeted the Federal Reserve. Musk suggested that DOGE should look into the Fed's expenditures on its headquarters renovation, which have spiraled to about $2.5 billion as of 2022 [2]. The central bank attributes the increased costs to higher building material and labor costs due to inflation. Musk's comments could further complicate the already fraught relationship between the Fed and the Trump administration.

The Federal Reserve's balance sheet has seen significant changes in recent months. As of May 2025, the total reserve balances with Federal Reserve Banks stood at USD 3.000T, down from USD 3.209T previously. This decrease reflects the Fed's efforts to normalize monetary policy following the COVID-19 pandemic [3].

The upcoming Fed policy meeting on May 6-7 will be closely watched as these economic indicators are assessed. Investors and financial professionals will be looking for signals on whether the Fed will adjust interest rates to address potential economic slowing.

References:

[1] https://www.indexbox.io/blog/trump-criticizes-federal-reserve-calls-for-lower-interest-rates/
[2] https://www.mpamag.com/us/news/general/musks-doge-sets-its-sights-on-the-federal-reserve/534159
[3] https://www.foxbusiness.com/economy/doge-should-definitely-look-federal-reserve-costs-elon-musk-says