According to BlockBeats, on September 17th, based on publicly available market data, two months before the 2024 presidential election, the Federal Reserve, led by Powell, cut interest rates by 50 basis points while core CPI remained as high as 3.3%; two years later, with only two months left until the 2026 midterm elections, the Federal Reserve, led by Warsh, raised interest rates by 25 basis points while core CPI fell to 2.4%.
Both periods are crucial before the election, yet the Federal Reserve's policy direction under Powell and Warsh has seen a dramatic reversal. This contrast is particularly intriguing. Trump had previously advocated for lower interest rates and selected Warsh as Fed Chairman, which the market initially saw as a key personnel move to push for rate cuts. However, Warsh's first interest rate decision after taking office was a rate hike.
Warsh cited reasons including a strong U.S. economy, persistently high inflation, and geopolitical shifts. Among these, the U.S. strike on Iran and the resulting energy and geopolitical risks were also factors in the Federal Reserve's reassessment of the economic outlook.