16-7-2025 – Traders are pricing in over a 50% chance of a Federal Reserve interest rate cut in September, fueled by reports that President Donald Trump has drafted a termination letter for Fed Chairman Jerome Powell. The speculation, noted on X posts, reflects growing market anticipation of a policy shift amid Trump’s ongoing criticism of Powell’s high-rate stance.
Since taking office in January 2025, Trump has repeatedly urged Powell to lower the Fed’s benchmark rate, currently steady at 4.25%–4.5%, calling him “too late” and “wrong” on monetary policy. The President’s tariff policies, which Powell cited as inflationary, have kept the Fed cautious, delaying anticipated cuts . A potential ousting of Powell, whose term ends in May 2026, could disrupt the Fed’s independence, a cornerstone of global financial stability, and push markets toward volatility. Legal experts note that firing Powell would require “cause,” a high bar under federal law, making the threat’s feasibility uncertain.
The crypto market, sensitive to interest rate changes, could see significant impacts from a rate cut, potentially boosting liquidity and investment in digital assets like Bitcoin. However, analysts warn that a sudden leadership change at the Fed risks market instability, with equities and crypto prices potentially facing sharp fluctuations. Treasury Secretary Scott Bessent has reportedly cautioned against removing Powell, citing risks to financial markets.
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