Trump Says New Fed Chair Will Deliver Rapid Interest Rate Cuts, Markets Cautious
U.S. President Donald Trump said in an Iowa speech that once a new Federal Reserve Chair replaces Jerome Powell, interest rates will be cut rapidly. His remarks, made ahead of Powell’s term expiry in May 2026 and an upcoming FOMC meeting, have increased market speculation about an earlier-than-expected nomination and greater presidential influence over monetary policy. Possible Fed Chair candidates cited include BlackRock CIO Rick Rieder (front-runner), former Fed Governor Kevin Warsh, adviser Kevin Hassett, and Fed Governor Chris Waller. Markets remain cautious for the immediate FOMC decision; CME FedWatch shows a 97% probability rates will be held at 3.5–3.75% at the meeting. Medium-term pricing shifted after Trump’s comments: the dollar index weakened toward ~96, gold surged to new highs, and Bitcoin fell to about $88,000 amid short-term uncertainty. Crypto analyst Anthony Pompliano praised Rieder’s stance and urged a fast appointment. The article notes renewed debate over Fed independence and reiterates that short-term rate cuts are unlikely despite rising odds for cuts later in the year. (Primary keywords: Fed chair, interest rate cuts, Bitcoin, dollar index, gold; Secondary keywords: FOMC, Rick Rieder, market outlook, monetary policy)
Neutral
Trump’s public push for rapid interest-rate cuts and naming potential Fed Chair candidates increases political pressure and shifts medium-term market expectations, but it does not change the immediate outlook. CME FedWatch shows a 97% chance the Fed will hold rates at the next FOMC meeting, so near-term policy and macro conditions remain guided by data, not rhetoric. Market responses—dollar weakness, gold rally, and a short-term dip in Bitcoin—reflect positioning and volatility rather than a confirmed policy turn. Historical parallels: political commentary about central bank appointments (e.g., past U.S. presidential statements) often moves risk assets and FX briefly but does not guarantee policy change until an appointment is confirmed and the Fed acts. For traders: expect heightened volatility around nomination news, FOMC communications, and economic data. Short-term: increased trading ranges for USD, gold, and crypto; risk-on/risk-off swings based on nomination signals. Medium-to-long term: if a nominee with explicit easing bias (e.g., Rick Rieder’s reportedly dovish view) is confirmed, easing expectations could become priced in—supporting higher gold and risk assets, and putting downward pressure on the dollar. However, confirmation and actual rate cuts would take months, so any sustained bullish or bearish crypto trend depends on macro developments (inflation, employment) and Fed actions rather than rhetoric alone.