President Trump celebrated gross domestic product (GDP) growing by 4.3% in the third quarter, although he noted that the stock market isn’t responding accordingly due to fears of the Fed raising interest rates in response to inflation.
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“A Nation can never be Economically GREAT if ‘eggheads’ are allowed to do everything within their power to destroy the upward slope,” Trump said in a Truth Social post on Tuesday, adding he wants the new Fed Chair to lower rates if the market is performing well. Jerome Powell, the current Fed Chair, is set to be replaced by a Trump nominee once his term expires in May 2026.
Inflation Stays Above Target with Core PCE at 2.9%
Alongside the GDP update, the Bureau of Economic Analysis noted that core personal consumption expenditures (PCE) rose by 2.9% during the quarter. Core PCE is the Fed’s preferred gauge of inflation and remains above the central bank’s target of 2%.
“Anybody that disagrees with me will never be the Fed Chairman!” Trump said.
The market now expects an 86.7% chance of the Fed holding rates steady next month, up from 80.1% a day ago, according to CME’s FedWatch tool. The odds of a 25 bps rate cut fell to 13.3% from 19.9%.
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