U.S. President Donald Trump has again commented on the interest rates and how low they should be. The president also revealed his plans to name Fed Chair Jerome Powell’s successor soon, despite earlier reports that the administration is currently interviewing 11 candidates. Meanwhile, the odds of a September Fed rate cut has reached a new high.
Trump Comments On Interest Rates Amid Fed Rate Cut Hopes
During his visit to the Kennedy Center, the U.S. president said that he believes that interest rates should be three or four points lower, bringing the rates down to 1%. He remarked that despite the Fed’s refusal to cut rates, the U.S. economy is powering through it.
Meanwhile, Trump also said that he will name a new Fed Chair early, although Powell’s term doesn’t end until May next year. The president added that the shortlist is down to three to four names. He is likely to name a candidate who is fully in support of a Fed rate cut.
CoinGape had reported earlier that 11 candidates are on the list to replace Powell. Treasury Secretary Scott Bessent, who is in charge of the screening process, had also confirmed that he had expanded his search for candidates who could replace the Fed Chair.
In the meantime, Chris Waller is the favorite to replace Powell as the next chair. Meanwhile, Kevin Warsh and Kevin Hassett are currently the second and third favorites to become the next Fed chair. It is worth noting that Trump had earlier said that he had “two Kevins” and two others on his short list.
Odds For A September Cut Soar
CME FedWatch data show that the odds of a 25-basis-point Fed rate cut in September have reached 99.9%. There is only a 0.1% chance that the FOMC will leave rates unchanged after the September 17 meeting.
Interestingly, Scott Bessent had urged the Fed to consider a 50 bps rate cut in September. He reiterated this point today in a Bloomberg interview, saying that cuts should start with 50 bps in September.
He further remarked that interest rates should be 150 to 175 bps lower by now. He claimed that a Fed rate cut would have happened earlier if data had been accurate. This likely includes the U.S. job data, which had earlier suggested that the labor market was strong.
However, the July data showed that nonfarm payrolls rose to 73,000, lower than expectations of 147,000. Meanwhile, the May and June data were revised downwards from 144,000 and 147,000, respectively, to 19,000 and 14,000.
Boluwatife Adeyemi
Boluwatife Adeyemi is a well-experienced crypto news writer and editor who has covered topics that cut across several niches. His speed and alacrity in covering breaking updates are second to none. He has a knack for simplifying the most technical concepts and making them easy for crypto newbies to understand.
Boluwatife is also a lawyer, who holds a law degree from the University of Ibadan. He also holds a certification in Digital Marketing.
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