Overview

• President Trump sent a direct letter to Fed Chair Jerome Powell on June 30 demanding an immediate interest-rate cut and announced plans to lift U.S. sanctions on Syria.
• At the Sintra forum in Portugal, Powell reiterated that the Fed cannot set a predetermined timeline for rate cuts and will wait for clear signals from inflation and labor market data.
• Powell said that without Trump’s tariffs, the Fed would have already reduced rates and noted that the levies have pushed up near-term inflation forecasts.
• Responding to Trump’s public criticism, Powell affirmed his focus on using the Fed’s congressional tools to achieve price stability.
• Powell warned that the current U.S. debt trajectory is unsustainable and ECB President Christine Lagarde said euro-zone inflation is at target but requires ongoing vigilance due to global uncertainty.