Trump has recently lost some battles in his war on the Federal Reserve: he did not succeed in expelling the federal ruler Lisa Cook, and his calls are not likely to be answered to a significant reduction.
Sunday night He told reporters: “I think you have great pieces” to get out of the FOOM market meeting this week. He added: “I don’t think it can help but it is perfect for cutting.”
Trump has been pressing Powell to reduce him since winning the Oval Office (although pressure on the opposite before the elections). He even gave Powell the title “It is too late”, in his opinion, was late in reducing the basic price with the change of market conditions. Do not miss a chance to criticize Powell, Trump added this week that the Federal Reserve Chairman was “incompetent.”
While many analysts agree that the economic environment calls for a decrease in the basic rate, currently by 4.25 % to 4.5 %, few believe that the committee will go further than reducing one click (25 basis points). Some speculators, Like Treasury Secretary Scott BessinWe believe that the Federal Reserve should be cut by 50 basis.
However, the market is generally not sold on this strategy, with interest investors Pricing at a chance of 3.9 % only From FOMC Reducing the rate to 3.75 % to 4 %.
In addition to Trump’s demands, it is likely to be necessary, Its display of a more convenient voting board It was distinguished. Trump and his team members claimed that Lisa Cook made false statements about the mortgage agreements. When writing on the social truth last month, Trump Cook claimed two major housing (in Ann Arbor and Atlanta) in 2021 to secure better conditions and that he “removes” from his position in this way.
Cook took the matter to the court, and Federal Appeal Court Yesterday, she ruled that the economist cannot be expelled from her position by the White House.
With the time of Cook vote in time for the FOMC meeting that will conclude today, Trump has the opportunity to replace the ruler with a more expert on his own.
Miran effect
The pressure to cut off a friendly face will be on the table in the form of Stephen Miran, the White House advisor who will temporarily sit on FOMC as an alternative to the ruler Adriana Kogler.
Miran, Chairman of the Economic Advisers, will retain his role as a Tram’s adviser – a step that has sparked eyebrows among those most concerned about the independence of the Federal Reserve from political intervention.
The new Joininer’s argument for pieces-no matter how clear it is. Given the federal reserve’s mandate, inflation is warm but not very hot, and the employment side appears to be fragile to the federal reserve.
The work statistics office reported that last month the United States added 22,000 jobs, and other reviews to the year ending in March 2025 showed that America added roles less than a million of the roles that were previously believed. Although this larger review is used only for policy decisions to move forward, it enhances the argument that the labor market works much worse than he had previously hoped.
Until then, analysts do not believe that more than 25 bits will be cut when the meeting ends in the afternoon. David Doyle wrote from Macquarie on a note I saw luck He expects a smaller decrease, adding: “There may be opponents in favor of cutting 50 -bit per second. Conservatives, Al -Yaris and Powell opponents in July (compared to 25 basis points), while Stephen Miran is likely to oppose …
“Linguistic changes in reporting can tend towards an occurrence, which reflects the recent deterioration in the labor market data. President Powell is likely to repeat his accent from Jackson Hall during his press conference and confirms that the shift in risk balance requires an amendment to the policy rate.”
In fact, although Professor Warton Jeremy will make the primary rate should be about 3 %, he does not defend a greater reduction. Writing for WisdomtreeWhere the major economists are, Professor Siegel wrote: “If the committee introduces a week (this), then it will be reduced at every subsequent meeting until the end of the year, then these are 75 basis points by December 31, enough to maintain growth on the right track and reduce the possibilities of a prestige caused by politics.”
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