Markets Price in Dovish Fed Shift as Trump Vets Powell’s Successors
Traders now expect five quarter-point rate cuts by end-2025, up from four projected a month ago, as political pressure reshapes monetary policy expectations. Federal Reserve Chair Jerome Powell faces mounting criticism from President Donald Trump, who publicly labels him "Mr Too Late" for slow rate cuts and confirms active vetting of replacements.
Futures markets have fully priced in accelerated easing, with Fed Governor Christopher Waller's recent openness to a July cut reinforcing the dovish pivot. Trump's shortlist reportedly includes former crisis-era Fed official Kevin Warsh and current Treasury Secretary Scott Bessent, injecting uncertainty into the central bank's leadership transition.