Powell's Resignation Controversy: Market Test or Sign of Policy Shift?
In early June, news of "Powell's impending resignation" spread wildly in the crypto and financial communities, with some speculating it was a result of pressure from the White House, while others believed it was a leak of policy disagreements within the Federal Reserve. However, the fact is that Powell himself has not indicated any intention to resign, but has repeatedly emphasized that he will serve his full term until 2026.
This controversy resembles a "market stress test." Recently, the Federal Reserve has been pushing for internal structural reforms, planning to lay off 10% of its staff to optimize efficiency, signaling a "transformation." But investors are not focused on personnel changes; rather, they are concerned about whether this indicates a significant shift in monetary policy.
Meanwhile, Trump has again made headlines, stating, "Now is the perfect time for interest rate cuts!" This combination of political pressure and resignation rumors has unwittingly become a litmus test for the market's perception of the Federal Reserve's independence.
Key questions arise:
- If Powell insists on not resigning but begins to cave to political pressure, does that mean the Federal Reserve will abandon its anti-inflation stance?
- If the June FOMC meeting signals dovishness, will the market preemptively price in a new round of easing?
Currently, traders' consensus is that Powell's job status is not the key issue; the real indicator is whether he will adjust the policy framework. If the Federal Reserve shifts to interest rate cuts without meeting inflation targets, it could lead to a flood of U.S. dollar liquidity, subsequently driving up risk assets like Bitcoin.
Further considerations:
- Historical experience shows that public conflicts between the president and the Federal Reserve often lead to increased market volatility.
- If Trump is re-elected and nominates a new chair, the Federal Reserve's independence in monetary policy may face even greater challenges.
