Fed, Powell and Bessent
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Speculation that President Donald Trump will eventually tap a dovish successor to Federal Reserve Chair Jerome Powell is feeding into a bullish tilt in Treasury options.
As speculation swirled Wednesday that President Trump might fire Federal Reserve Chair Jerome Powell, investors scrambled to adjust their strategies, despite Trump later downplaying the possibility, Bloomberg News reported Sunday.
Amidst Trump administration pressure and speculation, Congresswoman Luna claims Federal Reserve Chair Jerome Powell's dismissal is imminent. Treasury
Bond traders are boosting bets that the Federal Reserve will cut interest rates more aggressively next year, as speculation mounts that an eventual change of leadership at the central bank will deliver the easier monetary policy that President Donald Trump is demanding.
The New York Times was first to report, Trump waved a draft letter firing Powell during a meeting with House Republicans, and soliciting their opinions on whether he should proceed. The next day, Trump confirmed that was true: “I talked about the concept of firing him,
But shortly after the news broke, Trump threw cold water on the speculation, telling reporters he had no current plans to fire the Fed chair: “I don’t rule out anything, but I think it’s highly unlikely, unless he has to leave for fraud.”
Bond traders are boosting bets that the Federal Reserve will cut interest rates more aggressively next year, as speculation mounts that an eventual change of leadership at the central bank will deliver the easier monetary policy that President Donald Trump is demanding.
The Treasury secretary also stated his preference that Powell step down from the Fed entirely when his term ends. “Traditionally, the Fed chair also steps down as a governor."
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