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.

For a moment on Wednesday, it looked like President Donald Trump would finally attempt the improbable and fire Federal Reserve Chair Jerome Powell.

WASHINGTON, July 9 (Reuters) - U.S. President Donald Trump on Wednesday called on the Federal Reserve to lower the federal benchmark interest rate by at least 3 percentage points, renewing his call for the U.S. central bank to lower rates to help reduce the cost to service the nation's debt.

President Trump is pushing for 1% interest rates despite a healthy economy with 4.1% unemployment. The ultra-low rates could devastate savings accounts while creating unpredictable effects on mortgages and investment markets.

The right to freedom of speech allows Trump to make demands of the Fed to his heart's content. But legally, he cannot compel the central bank to lower its benchmark interest rate. The Fed has the right to act independently, and its aim is to promote a healthy and stable economy by keeping inflation in check.

President Donald Trump has intensified his criticism of Federal Reserve Chairman Jerome Powell, aiming to replace him with someone who will lower interest rates.

A Fed policy rate that low is not typically a sign that the United States is the "hottest" country in the world for investment, as Trump has said. It is usually a crisis response to an economy in serious trouble.

J.P. Morgan warned in a note that Trump's pressure on the Federal Reserve and threats to fire Chair Powell could undercut central bank independence and increase inflation risks.