From Quiver Quantitative: 2025-04-22 01:24:00

President Trump’s warning on Truth Social about the U.S. economy slowing unless the Federal Reserve cuts interest rates immediately has sparked concerns over central bank independence. This led to a 2% drop in the S&P 500 and an increase in Treasury yields. Fed policymakers are cautious, maintaining rates at 4.25%–4.50% amid uncertainty over the impact of import taxes on inflation. Trump’s criticism of Fed Chair Powell has raised questions about potential political interference. Markets await the next policy meeting on May 6–7 for clarity on rate cuts and inflation risks amid escalating tariff pressures.

The Conference Board’s leading index fell 0.7% in March, highlighting weakening consumer sentiment and manufacturing activity. With inflation metrics expected to ease, tariff-induced price shocks could challenge the Fed’s 2% target. Financial markets face volatility as long-term yields rise, impacting borrowing costs. The delicate balance between political directives and economic concerns is crucial as uncertainties persist regarding U.S. growth and monetary stability.



Read more at Quiver Quantitative: Trump’s Rate-Cut Ultimatum Sparks Market Selloff and Fed Independence Fears