Trump is calling for a cut in the Fed rate that goes against Powell’s move
The Federal Reserve held interest rates on the benchmark on June 18th unchanged, opposing President Trump’s demands for immediate cuts despite increased political pressure.
Cheddar
US stocks have opened higher, with the Broad S&P 500 and Tech Heavy Nasdaq approaching record highs for regular sessions.
Micron’s powerful quarterly outcome is to refuel the optimism of artificial intelligence. Nvidia’s shares rose to record highs.
Meanwhile, President Donald Trump’s new objective for Federal Reserve Chairman Powell may accelerate his bets for faster rate cuts.
For months, Trump has been blaming Powell for stabilizing interest rates. He is currently considering selecting and presenting a Powell alternative in September or early October. Early announcements allow new choices to create policy and interest rate comments in the background, damaging Powell.
Lower interest rates make borrowing cheaper, encouraging businesses and individuals to spend more and boost the economy.
At 9:35am (ET), the Blue Chip Dow added 0.52% (225.53 points) to 43,207.96. The S&P 500 rose 0.38% or 23.17 points to 6,115.33. Nasdaq has 0.27% (53.98 points) to 20,027.53. The benchmark 10-year financial yield fell to 4.265%.
Powell concluded his two-day testimony before Congress, repeating his meeting approach to interest rates. He stuck to the script and said he wanted to wait to see the impact of tariffs on inflation, the economy and labor markets before making an interest rate decision.
Before Bell, the weekly initial unemployment claim data showed fewer people than expected applications for unemployment benefits. But the repeated claims — showing how unemployed people are and receiving benefits — jumped at its best since November 2021.
meanwhile. According to the Bureau of Economic Analysis, Gross Domestic Product (GDP) fell by 0.5% in the first three months of the year due to a decline in GDP calculations and a decline in government spending. They said these were partially offset by increased investments and consumer spending.
Economists say GDP figures have been skewed by a surge in imports to Trump’s tariff frontrunners. GDP should bounce back as they don’t expect it to happen again in the second quarter.
The government previously estimated that the economy had shrunk by 0.2% in the first three months.
More inflation data coming up
Powell, known for being data dependent on his interest rate decisions, will get more that over the weekend, including inflation data.
The Fed’s preferred inflation gauge is expected to rise by 2.3% per year in May, with a 2.6% increase in core rates excluding food and energy. Most economists hope these numbers will continue to rise this summer.
In addition to inflation data, investors can get a glimpse into consumer spending, or through PCE, data. Consumer expenditure accounts for about two-thirds of economic activity.
Corporate News
- Micron’s results outperformed analysts’ forecasts for the third fiscal quarter. The manufacturer of memory and storage products also issued guidance for the last three months of the fiscal year that exceeded expectations. Stocks rise in fragments.
- HB Fuller has broken through recent quarter estimates and released a strong annual outlook. The share jumped 11.27%.
- Kratos Defense & Security Solutions plans to sell $500 million in common stock in an underwritten public offering. Stocks fell 5.54%.
- Investment Bank Jeffries’ quarterly results missed analysts’ predictions. Stocks fell.
- Drugstore chain Walgreens’ quarterly results beat forecasts. The stocks are even higher.
- Spicemaker McCormick said it could outperform analysts’ forecasts for quarterly results and manage higher tariffs. Stocks rose 5.11%.
Cryptocurrency
The Federal Housing Finance Agency has ordered Fannie Mae and Freddie Mac to formally consider cryptocurrencies as assets in the risk assessment of single-family mortgages. Housing finance companies should develop proposals that include digital assets without requiring borrowers to settle in US dollars prior to the loan closure.
Bitcoin fell 0.12% to $107,211.90.
(This story has been updated with new information.)
Medora Lee is a money, market and personal finance reporter for USA Today. mjlee@usatoday.com and Subscribe to our free daily money newsletter Personal finance tips and business news every Monday to Friday.
