President Trump has pressured Federal Reserve Chair Jerome Powell to lower the federal funds rate on multiple occasions, although his requests will likely be in vain ahead of the Fed’s interest rate announcement at 2:00 p.m. Eastern time today.
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“So we have a stupid person. Frankly, you probably won’t cut today,” said Trump outside the White House on Tuesday. He also said that the rate should be at least 2% lower compared to the current rate in a range between 4.25% and 4.50%.
“He’s a political guy who’s not a smart person, but he’s costing the country a fortune,” added Trump.
Traders Price in 99.9% Chance of an Unchanged Rate
The market is expecting the Fed to keep the federal funds rate unchanged at today’s meeting. Any other decision would be a major shock to the market based on CME’s FedWatch tool, which prices in a 99.9% chance of an unchanged rate and a 0.1% chance for a 25 basis points (bps) reduction.
The market will have to wait until the next Fed meeting on July 30 before seeing any real chance of a rate cut. At that meeting, there is an 85.5% chance of rates remaining unchanged and a 14.5% chance for a 25 bps reduction.
Track the federal funds rate and other key economic indicators with TipRanks’ Economic Indicators Dashboard.
