Analysis: Trump 2.0 is complicating the Fed's path to rate cuts

Federal Reserve Chairman Jerome Powell made it clear last week that even if Trump wanted to fire him, he did not think Trump had the power to do so. But one aspect he did not answer was how Trump's proposed economic policies might affect the Fed's expectations for a series of additional rate cuts in 2025. "There's nothing to simulate yet," Powell told reporters last week after the Fed announced its second rate cut this year. Many economists have begun to lower their expectations for the number and pace of Fed rate cuts next year due to these policies proposed by the new Trump administration. Powell declined to say what might happen at the Fed's last meeting in December 2024, saying: "We can only see where the data takes us. We still have six weeks of data to look at." (Jin Shi)