“I will soon announce our next chair of the Federal Reserve, someone who believes in lower, much lower interest rates, and mortgage payments will fall even further,” Trump declared during a national pronouncement in which he highlighted economic and national security achievements in the first year of his second term.
Trump had already signaled that he intends to announce, at the beginning of next year, the successor of current president of Fed, Jerome Powell. Among the most cited names are Kevin Hassett, economic advisor to the White House; Kevin Warsh, former director of Fed; and Chris Waller, current director of the institution. All are seen as interest advocates below current levels.
Despite this, none of the candidates indicated explicit willingness to reduce the basic rate to the more aggressive levels defended by Trump — at some times, close to 1%. Currently, the rate of Fed remains in the range between 3.5% and 3.75%, and even the last indicated by Trump to the board, Stephen Miran, does not defend such deep cuts. The president reinforced his desire for lower mortgage rates, although experts highlight that the rate controlled by the Fed has limited impact on long-term financing. These costs are more strongly influenced by income from securities such as the 10-year Treasury, which reflect expectations of economic growth and inflation — variables that have changed little in the past year. As a result, mortgage rates remain stable, between 6.3% and 6.4%. In a recent interview with Wall Street Journal, Trump stated that he was inclined to choose Warsh or Hassett, although conversations continue. He also suggested that the next chair Fed should consult him on monetary policy decisions, a stance that contrasts with the tradition of independence of the US central bank. In a scenario of possible changes in the conduct of US monetary policy, global markets tend to react with high sensitivity. Lower interest expectations directly impact the dollar, the incomes of the Treasuries and assets such as gold (XAU/USD), which often strengthens in periods of uncertainty or adjustment in economic policy.When interest and policy have seen triggers for volatility, IA Trader real-time monitoring market behavior to seek more judicious inputs, exposure control and consistent decisions within the rules of strategy — with discipline and risk management as a priority.
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