Trump stated he would be “deeply disappointed” if his Fed Chair nominee Kevin Warsh fails to cut rates quickly after taking office and demanded investigation into Fed’s new building costs.
At Senate hearing, Warsh stressed presidential/congressional rate comments do not threaten Fed independence and called for “institutional reform”: update inflation framework, improve communication (criticized excessive official statements), while noting AI can boost productivity and create room for rate cuts.
Hearing reinforced Fed independence expectations, temporarily easing Trump interference concerns, but Warsh’s “hawkish” tone + tension with Trump’s rate-cut demands may heighten policy uncertainty, push Treasury yields higher, and suppress equity risk appetite.
US March retail sales +1.7% MoM (largest in >1 year), driven by oil-price surge (gas station spending +15.5%); “Big Beautiful” bill tax rebates + stable stocks supported consumer resilience.
Economists warn K-shaped consumption divergence may intensify as rebates fade, high oil persists, and hiring slows — end-April GDP data will be key test. Strong data eases recession fears but inflation pass-through from high oil may limit Fed cut room.