BlockBeats News, September 4th: After Powell’s interest rate cut signal on August 22nd, Trump sought to control the Fed with the following timeline:
Powell’s Attitude Shift:
On August 22nd, Powell, at the Jackson Hole Symposium, released a “rate cut signal” citing a “shift in risk balance,” causing the probability of a rate cut in September to rise from 75% to about 90%.
Fed Governor Cunliffe Dismissed:
On August 22nd, the same day as Powell’s speech, Trump once again threatened to fire Fed Governor Cunliffe.
On August 26th, Trump dismissed Fed Governor Cunliffe, effective immediately. Hours later, Cunliffe responded, saying there was no reason to be fired and he would not resign.
On August 27th, a Fed spokesperson stated that Cunliffe remains a Fed governor and can participate in the rate decision until a ruling is made.
On August 28th, Cunliffe sued Trump over his dismissal from the Fed board.
On August 30th, a judge did not rule on the case and requested both parties to submit further court documents.
Trump Seeks to Control the Fed:
On August 27th, Trump said he would soon have a majority stake at the Fed and might move Milan to another Fed position with a longer term. Milan was previously an “interim” governor.
On August 27th, according to foreign media reports, the Trump administration intensified its scrutiny of the selection process for regional Fed presidents, extending its influence over the regional Feds that impact the central bank.
Pending Items This Week:
The U.S. Senate Banking Committee will hold a confirmation hearing on Thursday morning local time for Trump’s nominated Fed governor candidate Milan.
The Director of the U.S. Federal Housing Finance Agency will provide the latest information on Fed Governor Cunliffe’s mortgage fraud case at 10 p.m. Beijing time on Thursday night. (FXStreet)
