Economic Leader Trump Advocates for Interest Rate Reductions Simultaneously with Encouraging Employment Indicators - Potential Boost for Digital Currencies?
Heads Up: Another Round of Rate Cuts for Bitcoin? Not So Fast, Says Powell
Once again, President Trump is hankering for lower interest rates after the positive US employment data. Some financial experts are holding out hope that fresh rate cuts could ignite a bullish trend for Bitcoin. However, there's no sign that Powell is budging, and the situation seems less likely than ever.
Tariffs could potentially unleash a storm of chaos, and the economy isn't exactly begging for rate cuts right now.
Can Trump Muscle His Way to Rate Cuts?
Earlier today, the US Bureau of Labor Statistics just dropped its latest jobs report, which looks, well, optimistic, despite the looming specter of recession.
Total nonfarm payroll employment ticked up by 177K jobs, exceeding expectations. Unemployment stayed steady, and wages kept climbing. This gratifying news prompted President Trump to plead once again for interest rate reductions:
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President Trump has been chasing after Federal Reserve Chair Jerome Powell like a dog with a bone, begging for rate cuts. The crypto world has also been drumming up support for such a move, believing it would encourage investment in high-risk assets like Bitcoin.
However, Powell and other heavy-hitters at the Fed have made it crystal clear that tariffs are too dicey to lower rates further.
Powell has been steady as a rock in his beliefs. Tariffs could rain down absolute havoc on the economy, and the Fed needs to conserve its firepower to forestall a potential crisis. If the Fed chopped rates after booming numbers, it'd be left with one fewer trick up its sleeve in a real bind.
Trump even tried to bully Powell over the whole rate cut issue, but he eventually backed down when the markets got spooked. He doesn't have the legal authority to fire Powell—paunching such a key regulator would undoubtedly cause mass pandemonium.
In the wake of the jobs report, the market started to expect fewer rate cuts, and the CME reported that a cut in May is all but impossible.
To spell it out plainly, the odds of Trump getting his coveted rate cuts are looking pretty slim. Brookings Institution economist Justin Wolfers put it this way:
"I'd be shocked if the Fed doesn't hold its ground at its next meeting. The actual economy is strong enough to not demand a rate cut yet. The big questions are just lurking around the corner. Powell's made it clear: He doesn't want to make wild guesses about what's awaiting us—he wants to wait and see. The report is perfect. White House interpretations are a different story," he remarked.
Trump wants those rate cuts, but he's not gonna get them without causing bigger problems. The tariffs are a wildcard, and bogus rumors have sent waves through the crypto market on several recent instances.
Remember, if it looks too good to be true, it probably is.
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- In the crypto world, some financial experts are holding out hope that potential fresh rate cuts could ignite a bullish trend for Bitcoin.
- Trump has been chasing after Federal Reserve Chair Jerome Powell, begrudgingly requesting rate cuts, but Powell has made it clear that tariffs are too dicey to lower rates further.
- Powell has been steadfast in his beliefs, understanding that tariffs could rain down absolute havoc on the economy, and the Fed needs to conserve its firepower to forestall a potential crisis.
- To spell it out plainly, the odds of Trump getting his coveted rate cuts are looking pretty slim, as the actual economy is strong enough to not demand a rate cut yet.
- Trump's relentless pursuit of rate cuts could cause bigger problems, as the tariffs are a wildcard, and bogus rumors have sent waves through the crypto market on several recent instances.
- Reminding investors to verify facts independently, Trump's chasing of rate cuts, while backed by blunt persuasion, lacks legitimacy in the current strong economic conditions.
- Despite President Trump's best efforts, the current business, finance, and technology landscape is not bowing to his pressure for rate cuts, leaving the situation as less likely than ever.
