- Trump proposed a 300bps rate cut, calling it “rocket fuel” for the U.S. economy.
- Crypto markets expect a retail surge if rates drop, fueling altcoin momentum.
- Powell faces DOJ pressure over Fed renovation, but Trump won’t fire him.
President Donald Trump is again urging the Federal Reserve to cut interest rates by 300 basis points. He made the remarks while visiting the U.S. Central Bank and meeting with Fed Chair Jerome Powell. The call has sparked renewed speculation in financial and crypto markets about possible liquidity inflows.
Trump Pushes Fed for 300-Point Rate Cut
Trump’s push for a 300-point rate cut is his most aggressive stance yet. He made the statement while inspecting renovation work at the Federal Reserve alongside Jerome Powell. Trump used the current U.S rates in comparison with Switzerland and the European Union, mentioning that the U.S is way behind in easing.
He argued that the U.S. economy is healthy, inflation has slowed, and the labor market is also good. With these factors in place, he believes now is the time for a deep rate reduction. Trump labeled it “rocket fuel” for economic growth, repeating that rates should be the lowest among developed nations.
This pressure is timely as it could be a critical time for the Fed. As inflation inches down to target , and concerns over recession have lessened, there is increased speculation that a policy pivot is on the way. The remarks by Trump increased the anticipation that Powell will implement a change of course soon.
Crypto Analysts See Rate Cuts as Bullish Trigger
Trump’s remarks triggered widespread discussion in the crypto market. According to a post by Anonymous, Trump appeared “confident” Powell would lower rates soon. Trump’s “confidence” following the meeting suggests a rate cut may arrive soon. The tweet said the timing was “perfect” and projected a retail influx once rates fall.
When the rates are lowered , this leads to a decrease in the cost of borrowing and the unlocking of funds that are usually invested in high-risk assets such as Bitcoin and altcoins. Most traders feel that the next crypto bull run will hinge on a Fed pivot. Liquidity-driven rallies have historically aligned with Fed easing cycles.
Trump’s comments may also align with election-year positioning. Cheaper capital, stronger market sentiment, and retail participation could boost economic confidence ahead of the November polls.
Powell Faces Political Heat but Will Likely Stay
Powell also faces a further set of pressures with the Fed undergoing renovation amid controversy. Anna Paulina Luna, a member of the US Congress, brought charges against Powell to the DOJ in regards to claims of perjury over his renovation expenses. Despite rumors, Powell has not resigned.
Trump confirmed he has no plans to remove Powell. Nevertheless, he criticized the Fed Chair as late in cutting rates. He said the firing of Powell would be a bad idea for the independence of the Fed. However, he emphasized that everyone agrees that the better way is lower rates, even those who previously supported high rates.
