Powell may have difficulty avoiding the Trump brand “very late” even with the Federal Reserve Speaker the right thing

History indicates that President Donald Trump’s new title is “too late” for Federal Reserve Chairman Jerome Powell has a strong opportunity to verify, although he is barely alone if so.

After all, the central bank leaders have a long history of being very hesitant to raise or low interest rates.

Whether Arthur Burns, however, the rates are very low in the face of the threat of recession during the 1970s, Alan Greenban does not respond quickly enough to the Dotcom bubble in the nineties of the last century, or that Ben Bernanaki has been criticized to slow what they appear in prominent prices.

Therefore, some economists believe that Powell, who faces a unique set of challenges for the dual work goals in the Federal Reserve for Full Employment and low inflation, has a strong opportunity to wear the “late” brand.

In fact, many of them believe that there is no exactly what is Powell He should Do now.

Dan North, senior economists in Allianz in North America, said: “historically, counting and looking at any federal reserve, and I will return to the seventies, the federal reserve is always delayed in both directions,” said Dan North, senior economists in Allianz in North America. “They tend to wait. They want to wait to make sure they will not make a mistake, and by the time they do, the time is usually too late. The economy is always in a stagnation.”

However, he said that given the mixing of the volatile policy, with the threat of Trump’s tariff both growth and inflation, Powell has no choice but to sit in the absence of more clarity.

North said that Powell is in a situation that he does not win, with threats to both sides of the concept of the federal reserve, “which is why he does the right thing exact at this moment, and this is not something, because in one way or another it will be wrong.”

Trump wants to cut

Although Trump said the economy Maybe it will be fine Regardless of what the Federal Reserve is doing, the central bank was recently angry to reduce prices, and insists that inflation was killed.

in Social truth After the Federal Reserve this week’s decision to maintain rates unchanged, Trump announced that “Jerome Powell is very late” is a fool, he has no idea. “

However, the president’s tariff has not yet been prepared in the real economy, because it is barely a month old.

Modern economic data does not refer to price mutations and does not slow down in economic activity. However, investigative studies appear Increasing fears In both the manufacturing and services sectors, While the feelings of the consumer were strainedAnd about 90 % of the S&P 500 companies mentioned the tariff concerns about its quarterly profit calls.

in A press conference after preparing this weekNevertheless, Powell repeatedly expressed confidence in what the “strong” economy and the labor market called in line with the maximum of employment.

No “preventive” discounts

The 72 -year -old Federal Reserve Chairman also rejected any idea of ​​lowering preventive prices, despite what is indicated by morale survey data on current conditions.

“Powell offered two reasons for a lack of hurry. The first -” no real cost to wait ” – is what he might live for regret.” And the second – “We are not sure of what the right thing will be” – more logical. “

Powell enjoys his own history of delay, with hesitation in the Federal Reserve to rise when inflation began to climb in 2021.

“If they are waiting for the labor market to confirm whether they should reduce prices, by definition, it is too late,” said Joseph Lavingna, SMBC Nikko Securities, and a senior economic advisor for Trump in his first term. “I don’t think the Federal Reserve is taking enough.”

In fact, if the Federal Reserve is using the labor market as a guide, it will certainly be behind the curve. “The labor market is the last to know” when the recession comes, and history was somewhat consistent that job losses do not begin in general until after the start of decline.

Lavorgna believes that the Federal Reserve has been exposed from its history and you will miss this invitation as well, as policymakers are trying to no avail to get rid of the impact of customs duties.

“We will not know if the time was too late,” he said. “Economic history, along with the current market pricing, indicates a real danger because the federal reserve will be very late.”