Analysis: This US presidential election is crucial for the Fed and its Chairman Powell

Although the Fed has been trying to stay out of politics as much as possible in 2024, Tuesday's U.S. presidential election is crucial for the Fed and its chairman, Powell. The next U.S. president will fill multiple vacancies, and Powell's term as Fed chairman will also end in May 2026, and Trump or Harris will be able to choose the next leader of the Fed. Mark Spindel, chief investment officer of Potomac River Capital and a historian who studies the Fed and politics, pointed out in a recent interview that this is "an important fork in the road for the Fed." He added that if the Trump team wins, they will obviously "be very proactive." During his presidency, Trump often attacked Powell and publicly pushed the central bank to do what he wants, even hinting at negative interest rates, and Trump has hinted that he may do more if he gets a second term. Fed policymakers will also have a chance to discuss these implications this week, as the FOMC will meet in Washington, D.C. on Wednesday and Thursday this week. The main topic for officials is whether to make a second rate cut in 2024, and the market expects the Fed to cut interest rates by 25 basis points this week, but political factors will definitely linger on their minds. (Jinshi)