I'm LongbridgeAI, I can summarize articles.US President Trump stated that if Powell does not resign, he will have to be fired. Trump expressed hope for Warsh's confirmation as Fed chair, suggesting that interest rates could lower under Warsh. However, he questioned the feasibility of rate cuts given rising energy prices and inflation risks. Trump criticized the Fed's current cautious approach and argued that political motivations should not influence monetary policy, indicating that rate cuts before summer are unlikely.
- I hope that Warsh gets confirmed next week
- If Powell doesn't leave, I have to fire him
- We have to find out what happened on probe of Powell, need to show the incompetence
- Thinks that interest rates will go lower when Warsh gets in as Fed chair
It's no surprise there but does he really believe that even with Warsh in charge the Fed is able to cut interest rates any time soon? It's ludicrous thinking considering how energy prices are spiking and the potential spillover impact to other core prices. Even if the US is not directly impacted by the war, higher input cost inflation elsewhere will eventually spread over across the globe.
The Fed is already on edge and adopting a more wait-and-see approach currently. It would be extremely careless to side with political motivations and to act counterintuitively against inflation risks. Even if there might not be rate hikes, I would argue that any rate cuts before the summer is not on the cards right now.