Trump backs ‘fantastic’ Warsh while calling for lower rates and citing ‘bad intentions’ of other Fed officials

hahaha

It's an interesting case study, isn't it?

On one hand, you have fear of inflation....supporting hikes.

On the other, if Warsh/FED is "now" taking queues from the market, then a pullback like this means they shouldn't be hiking because the "markets" are handling the inflation pressures via supply/demand (as represented by the expectations of company profits/earnings and a willingness for prices to fall.....). Hiking will put more downward pressure equities and, thus, have a larger, and possibly accelerated, impact on the economy. The FED doesn't want to have to change month by month, so this may not be the time to hike either.

The rate cut odds being baked into the FED fund futures are suggesting it will be close though. 62/38 presently in favor of holding steady....which I think will happen. Other members don't want to rock the boat too much and Trump supporters don't want to hike and piss off the guy in the oval this early in Warsh's tenure.

***but I know ZERO about the inner workings of the FED nor of the back-room conversations any officials have had with businesses/the administration....so it's all conjecture.***

Plus, even if I DID know exactly what they were going to do and told you, for example, "100% rates will hike 25 bps", the market reaction to that decision may be completely the opposite of what one would expect. Such is the way of things.

https://www.cmegroup.com/markets/int...atch-tool.html