Trump wants Powell to lower rates. Here’s how to do that
By: Logan Mohtashami | Published: 2025-06-19 17:22:00 | Source: www.housingwire.com
Focus on what the Fed cares about: Labor data
As I have discussed since late 2022, the Federal Reserve is more focused on labor data than the growth rate of inflation when determining how many rate cuts it can deliver for the economy. In his remarks at Wednesday’s press conference, Powell said that the labor market is strong and does not require rate cuts.
However, Powell also highlighted the challenges faced by unemployed Americans and the difficulty of getting a new job. Before Powell switched the game plan in 2022, making it about the labor market more than inflation, he noted he would like to see the Fed Funds rate mirror 3, 6 and 12-month PCE data. Well, if they were operating off those numbers, the Fed Funds rate would be close to 3% since this is the most recent…
