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White House economic adviser says Jerome Powell’s Fed Board role could affect rate cuts

White House National Economic Council Director Kevin Hassett said Jerome Powell should leave the Fed, linked strong GDP data to data-dependent policy, and said oil futures could fall if Strait of Hormuz shipping normalizes.

Summary

White House National Economic Council Director Kevin Hassett said Jerome Powell remaining on the Federal Reserve Board could affect future rate-cut decisions and added that it was time for Powell to leave the Fed, while saying the administration was not attacking Federal Reserve independence. Hassett also cited strong GDP data and said policy decisions should remain data-dependent. In the same set of remarks, he said oil could flood the market and futures prices could fall sharply if the Strait of Hormuz reopens and shipping flows normalize. The comments matter for financial markets because Federal Reserve policy shapes liquidity and risk appetite, while oil-price moves can influence inflation expectations and broader market conditions, including crypto.

Terms & Concepts
  • Federal Reserve independence: The principle that the central bank should make monetary policy decisions without political pressure from elected officials or government offices.
  • Rate cuts: Reductions in benchmark interest rates that can lower borrowing costs and often influence investor demand for risk assets, including cryptocurrencies.
  • Strait of Hormuz: A strategically important shipping route for global oil flows, so disruptions or reopening can quickly affect energy prices and market expectations.