Trump Pressures Powell for a Big Cut Ahead of FOMC: "Rates Must Be Lowered Further"

On SNS, Trump Calls for a Larger Rate Cut Than Expected
Market Expects a 0.25 Percentage Point Reduction

U.S. President Donald Trump has once again urged Federal Reserve (Fed) Chair Jerome Powell to cut interest rates by more than 0.5 percentage points ahead of the upcoming Federal Open Market Committee (FOMC) meeting on the 17th (local time).

UPI Yonhap News

On the 15th, President Trump posted on his own social networking service, Truth Social, saying, "'Mr. Too Late' must lower interest rates," and added, "It should be by a larger margin than he had in mind." He also wrote, "Home prices will soar."

This statement is interpreted as pressure on Chair Powell to implement a so-called "big cut" of 0.5 percentage points, especially as a rate cut is widely anticipated at the September FOMC, now just two days away, due to recent weak employment data. President Trump has repeatedly referred to Chair Powell as "Mr. Too Late" for not moving quickly enough to cut rates. The day before, he also told reporters, "I expect a big cut," and emphasized, "Now is the perfect time to lower rates."

However, the market expects the Fed to cut rates by 0.25 percentage points at this September FOMC meeting. According to CME FedWatch, the federal funds futures market reflects a 96.2% probability that the Fed will lower the current target rate of 4.25-4.5% by 0.25 percentage points in September. The probability of a total cut of 0.75 percentage points by the end of the year stands at 74.9%.