The path to lower interest rates and a more accommodating Federal Reserve isn't straightforward for Trump. He's pushing for a shift in monetary policy, but several obstacles stand in his way.
First, the Fed jealously guards its independence. Openly pressuring the central bank risks undermining confidence in its decision-making process—something markets generally dislike. Second, inflation dynamics matter. If price pressures don't cool as expected, the Fed has little room to cut rates regardless of political pressure. Third, there's the bond market to consider. If investors lose faith in fiscal discipline, yields could rise on their own, forcing the Fed's hand regardless.
For crypto investors, this matters. Lower rates typically boost risk asset valuations, including Bitcoin and altcoins. But the Fed's credibility is paramount. Any perception that political pressure is steering monetary policy could shake confidence in the dollar itself—with ripple effects across all asset classes.
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ChainDetective
· 15h ago
Trump wants to hold back the Federal Reserve, but the Fed isn't buying it... Basically, it's a deadlock between political pressure and market confidence. The thing crypto people fear most is the collapse of the US dollar's credibility.
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LayerZeroJunkie
· 15h ago
To be honest, if Trump wants to move the Fed's stone, it will probably take quite an effort... Once the independence is shaken, market confidence is gone, and that's truly terrifying.
Whether Bitcoin rises or falls ultimately depends on the Fed's stance, but only if it has credibility. If politics become too heavy-handed, even the dollar will suffer, and we crypto folks will be the first to bear the brunt.
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GrayscaleArbitrageur
· 15h ago
Really, political pressure can't influence the Federal Reserve; the market has already learned its lesson. Do you still think rate cuts are good for the crypto market? Let's first stabilize confidence in the US dollar...
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FadCatcher
· 15h ago
Well... basically, Trump wants to cut interest rates, but the Federal Reserve won't be that obedient. The crypto world still depends on whether the Federal Reserve's credibility can hold up.
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GraphGuru
· 15h ago
What’s going on again? Trying to pressure the Federal Reserve? This trick doesn’t work anymore; the Fed’s independence is a solid fact.
The biggest fear in the crypto world is the collapse of dollar confidence. When that happens, even if interest rates are low, it’s useless.
The path to lower interest rates and a more accommodating Federal Reserve isn't straightforward for Trump. He's pushing for a shift in monetary policy, but several obstacles stand in his way.
First, the Fed jealously guards its independence. Openly pressuring the central bank risks undermining confidence in its decision-making process—something markets generally dislike. Second, inflation dynamics matter. If price pressures don't cool as expected, the Fed has little room to cut rates regardless of political pressure. Third, there's the bond market to consider. If investors lose faith in fiscal discipline, yields could rise on their own, forcing the Fed's hand regardless.
For crypto investors, this matters. Lower rates typically boost risk asset valuations, including Bitcoin and altcoins. But the Fed's credibility is paramount. Any perception that political pressure is steering monetary policy could shake confidence in the dollar itself—with ripple effects across all asset classes.