The Federal Reserve is less likely to make cuts this year as it grapples with a criminal probe, analysts say. That could undermine one of Trump’s goals.
The Justice Department’s criminal investigation of the Federal Reserve and Chair Jerome Powell’s willingness to fight back are already shaking Wall Street. But Main Street could feel shock waves, too.
The legal showdown makes it less likely that the Fed will lower interest rates this year, according to several analysts. Lower rates could translate into lower borrowing costs for consumers and businesses, helping support economic growth and the labor market.
Powell’s term as chair ends in May. But Friday’s subpoenas to the Fed make it “more likely that Powell will stay on as a governor to help protect the Fed after his term as chair ends,” Krishna Guha, vice chairman at financial firm Evercore ISI, wrote in a note Sunday.
Lemmyoutofhere@lemmy.ca 1 day ago
“Lower rates could translate into lower borrowing costs for consumers and businesses, helping support economic growth and the labor market.”
It will also increase inflation.
reddig33@lemmy.world 1 day ago
Increase inflation _that is already out of control. _
Lemmyoutofhere@lemmy.ca 1 day ago
Which leads to currency collapse.
Zachariah@lemmy.world 1 day ago
It’s almost like we need more tools than interest rate cuts to shape our economy.