This is a committee vote. I will be $100 right now that he can’t get the rest of the committee on board with such a drastic cut.
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And, after stepping down as chair, if Powell stays on the committee instead of retiring, this makes it more likely.
Pete
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The dollar dropped to its lowest point in four years on January 27 against all currencies that are important to the US Economy. For example, the US dollar has dropped 18% in the past year to the Mexican Peso, the largest trading partner to the United States, and the largest import country to the United States in terms of goods and services, in 2025 Twice the imports to the US compared to China. When was the last time the United States saw a big increase in the trade deficit? In 2024 when the dollar plunged to its lowest against the Mexican Peso. What did we see last month? A spike in the US trade imbalance.
Federal Reserve rate cuts are prompting investors to move out of U.S. assets (like Treasuries) in search of higher returns elsewhere. The “Greenland” fiasco certainly didn’t help confidence in US Treasuries. Now, we’re talking here about a Federal Reserve Chairman that wants to cuts the Federal Funds Rate below 2%. That would crush the dollar below 12::1 to the Peso as investors would move out of the dollar.
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