US President Donald Trump continues his pressure to reduce interest rates of the American Central Bank (FED). Trump, before the upcoming Federal Open Market Committee (FOMC) meeting, said the FED should reduce 100 basis points. It is observed that FED President Jerome Powell and the committee members have been cautious to take a step in this direction so far.
Hard interest rate reduction call from Trump
Trump wants the Fed to go to a strong reduction in interest rates for faster growth of the US economy. Trump, interest rate points to reduce 100 basis points to the economy “fuel effect” will provide the sharing of the official account was made.
Trump made similar demands at different times in the past. In his last statement, he suggested a higher rate of 100 basis points at a higher rate than the previous ones.
FED President Jerome Powell and Committee members say that economic data are meticulously analyzed while changing interest rates. Powell and its members emphasize that they need to be cautious in interest rate cuts, especially pointing to inflation and employment figures.
Jerome Powell: “We take our interest decisions by considering our current economic conditions and long -term goals.”
Economists and market commentators express different opinions as to whether the FED will significantly reduce interest rates in the short term. Many experts are not likely to reduce interest rates with Trump’s directives and associate it with the Fed’s independence.
The impact of the market and politics
Trump’s call for interest reduction brings with it the discussion of the extent to which economic policies can be shaped through political discourses. Experts underline the necessity of the central banks to act independently despite political pressures. The Fed’s future decision is closely monitored by market actors and political circles.
The effects of possible changes in interest rates on the US and global economic conditions will be extremely strong. Global markets consider the US Federal Bank’s decisions, currency values and capital flows. Fed’s possible step towards interest rate cuts will be a starting for bull markets where crypto money markets are excited.
Trump’s statements back to the agenda on the discussions on the relationship between the management and the Central Bank in the US economic policies. The ability of central banks to make independent decisions from political influences is important in terms of economic stability. The discussions before the FOMC meeting shape the expectations of the policy determinants and the market. Readers can follow their economic decisions accordingly by following how changes in interest rates can affect the national economy and global markets.
Responsibility Rejection: The information contained in this article does not contain investment advice. Investors should be aware that crypto currencies carry high volatility and thus risk and carry out their operations in line with their own research.
