James Bianco, president of Bianco Research, believes that the Federal Reserve's decision-making mechanism is undergoing a structural shift, with core power tilting from the individual chairman to a collective vote by the committee. Recently, the market's expectation probability for a rate cut in December has dropped from 70% to 42%, with the key not lying in economic data, but rather in the changing voting tendencies within the FOMC.
This breaks the traditional model dominated by the chairman and approved by a high vote from the committee. Committee members are beginning to show independent voting tendencies, and future policies will rely more on the independent judgments of the 12 committee members.
It is noteworthy that Trump's strategy of influencing the Federal Reserve through personnel appointments may, in fact, strengthen the independence of the committee's collective decision-making.
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The Federal Reserve is undergoing significant changes