TLDR:
- Trump demands a “bigger” rate cut from Powell, saying “Too Late” and predicting housing will soar.
- Markets expect a 25 basis point cut at the upcoming FOMC meeting; only a slim chance of larger move.
- Dollar slips ahead of Fed decision; crypto bitcoin falls slightly amid rate cut speculation.
- Trump’s Truth Social post on Sep 15 pushes urgency for steeper cuts than Powell has considered.
Donald Trump is pushing Fed Chair Jerome Powell to act more aggressively on interest rates. He says the cuts must be larger than what Powell has plotted. He warns failing to do so will hurt housing, though he promises it will soar if they drop rates.
His message came on Truth Social just before the Fed’s policy meeting this week. The pressure arrives as markets price in a modest cut but see little chance of a deeper drop.
Trump’s rate cut demand intensifies
Trump used a post on Truth Social to demand,
“Too Late MUST CUT INTEREST RATES, NOW, AND BIGGER THAN HE HAD IN MIND. HOUSING WILL SOAR.”
Reutersreports this came ahead of the U.S. central bank meeting. He referred directly to Jerome Powell. He wants cuts that go beyond what the Fed is likely planning.
Markets sensed urgency. Traders expect the Federal Open Market Committee (FOMC) to cut benchmark interest rates by 25 basis points during the meeting set for September 16-17. Only a small probability exists for a 50 basis point cut.
Trump argues housing markets suffer under higher mortgage and borrowing costs. He frames deeper cuts as a tool to revive home buying. He claims inflation is no longer a major concern, suggesting rate cuts won’t be risky.
The dollar has already started to slide. It fell to multi-month lows against other major currencies. That reflects rising expectations the Fed will ease.
Crypto markets felt some of that heat. Bitcoin dropped around 0.5 percent as rate cut hopes pushed on. It’s tied to broader sentiment. Less tight monetary policy often lifts risk-assets.
Housing is central in Trump’s argument. He says mortgage rates are too high. He claims deeper rate cuts will make housing affordable again. If that plays out, builders and homebuyers could respond fast.
Yet Fed watchers warn Powell may resist too large a cut. They expect cautious language at the Fed meeting. Chair Powell may emphasize data dependence. Concerns around inflation remain.
What’s at stake for crypto, price moves, and policy
Crypto investors watch this closely. If the Fed cuts more than expected, cheap money could boost speculative assets. Lower rates often help crypto price surges. But sudden moves may spur volatility.
If the Fed acts only modestly, crypto could stall. Investors may also shift to safe assets and inflation fears might reawaken. Rates staying high for longer could squeeze risk appetite.
Policy risk looms. Trump’s pressure tests the Fed’s independence. If the Fed moves more aggressively, it may reflect political influence. That threatens market confidence.
In short, rate cut size will matter. Small cut, muted response. Large cut, ripple effects across housing, crypto, and dollar. Powell will need to justify either path.
The post Trump Demands Deep Rate Cut: What It Means for Crypto Price Moves appeared first on Blockonomi.
Source: https://blockonomi.com/trump-demands-deep-rate-cut-what-it-means-for-crypto-price-moves/