Recent analyses from QCP Capital indicate that U.S. President Donald Trump is seeking to reshape the Federal Reserve to align with his economic views by pushing for a more flexible monetary policy. It is believed that several members, such as Michelle Bowman, Christopher Waller, and Marvin Goodfriend, lean towards supporting the interest rate reduction plans advocated by Trump.
If Lisa Cook is removed from her position on the Board of Governors, the balance may clearly shift in favor of members close to the former president, giving them an influential majority even before the new vice presidents and the next chair are appointed.
In a related context, the recent Jackson Hole meeting has once again highlighted concerns about a weak labor market, especially after reviewing non-farm payroll data that showed a noticeable decline. It seems that labor market pressures have become a greater challenge than the risk of accelerating inflation, which has strengthened market expectations that the upcoming Federal Reserve meeting in September may see a decision to cut interest rates.
On the other hand, markets are awaiting Nvidia's announcement of its financial results today, at a time when the company is seen as a key indicator of the strength or weakness of the artificial intelligence sector. Despite optimism about increased spending in this sector, the company faces challenges related to declining marginal returns from the expansion of large artificial intelligence models, which may pressure its profit margins.
As for cryptocurrencies, there has been increasing selling pressure from major asset holders recently, leading to a weak overall market performance. If the decline on Wall Street continues, traditional institutions' confidence in Bitcoin may be shaken again, opening the door for a new round of risk reduction and increasing the likelihood of sharp fluctuations in the digital asset market.