"Federal Reserve Mouthpiece": Powell's Second-to-Last FOMC Will Highlight Increasingly Acute Divisions Within the Fed

Crypto World News reports that on March 18, “Federal Reserve whisperer” Nick Timiraos wrote that the uncertainty brought by the Iran war is expected to further solidify the consensus among most Federal Reserve officials to hold steady at this week’s meeting. Given Jerome Powell’s upcoming departure as Fed Chair, any dissenting opinions will be particularly noticeable. The article states that divisions within the Fed are intensifying. The previously nearly unanimous votes are no longer the case, with increasing opposition, especially from several board members appointed by President Trump. Over the past year, three of Trump’s appointees have often disagreed with the majority, with two even opposing at the last Fed meeting. This week, all three may vote against a rate cut. Even if they do not reach a consensus, the possibility of such divisions recurring at each meeting signals a shift that could have impacts beyond any single vote. The key is not the vote margin but that all three directors were appointed by a president who openly called for lower interest rates. Since 1988, there has never been a time when three directors publicly opposed policy decisions at a meeting.