Fed Plays Chicken With Markets—No Rate Cuts as Trade War Tensions Simmer
Wall Street's rate-cut fantasy gets crushed—again—as Powell & Co. kick the can down the road. Meanwhile, tariff headlines flash like a crypto chart on margin call day.
Here's the damage:
- Fed holds firm: No lifeline for overleveraged traders praying for cheaper money
- Trade war tremors: Every Trump/Xi tweet now moves markets more than fundamentals
Bonus reality check: Remember when 'transitory inflation' was a thing? Good times.
$105,110 continues to hover around $105,000. Meanwhile, President Trump has once again expressed opposition to Federal Reserve Chairman Jerome Powell, as the U.S. economy is signaling potential concerns. The delay in interest rate cuts comes as the Federal Reserve awaits the impact of tariffs on inflation, raising questions about the economic outlook amidst weakening new employment figures. Here’s what you need to know today.
ContentsJune 4 SummaryExpectations for Cryptocurrencies
June 4 Summary
As this article was being prepared, ADP figures arrived ahead of the Non-Farm Payroll data set to release on Friday. ADP is considered a leading indicator for Non-Farm Payrolls, which, if falling below expectations this Friday, may push the Fed closer to rate cuts. Despite the ongoing trade war, stock futures remain relatively positive, with U.S. markets set to open soon after the publication of this article, potentially determining the direction for investors.
S&P 500 futures advanced, buoyed by consecutive gains in the U.S. benchmark index for the first time since mid-May. MSCI’s global stock index also reached a record high following increases in European and Asian markets.
In recent days, some experts have anticipated significant easing in U.S. employment due to tariffs in the coming months. This could be seen as a consequence of the Federal Reserve’s delayed rate cuts, leading TRUMP to urge “CUT INTEREST RATES” once again today.
Expectations for Cryptocurrencies
Bitcoin remains trading between $104,880 and $105,200. The lack of excessively negative statements from China continues to provide support for cryptocurrencies. With the entire market watching Friday’s data and post-call announcements between President Trump and President Xi Jinping, it is expected that volatility in cryptocurrencies will rapidly increase starting tomorrow. As the July 9 deadline approaches, time is running out for negotiation posturing, necessitating swift deal signings by both parties. The 90-day truce quickly passed.
Anticipation is high that several agreements will be finalized by next week. The European Union, under pressure from the U.S., is imposing restrictions on China, while China is attempting to maintain connections by increasing spending. Pursuing closer ties with Europe, Xi Jinping, in this vein, Chinese plans to order hundreds of Airbus planes are in motion. In an environment marked by trade disputes with the U.S., Beijing is negotiating with the aviation giant for up to 500 jets. This could be announced at a summit in July in Beijing, attended by Germany’s new Chancellor Friedrich Merz and French President Emmanuel Macron.
You can follow our news on Telegram, Facebook, Twitter & Coinmarketcap Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.