Powell's Statement on Trade Agreement: Expectations for Interest Rate Cuts and Economic Growth

- **Chair Jerome Powell Mentions Possibility of Interest Rate Cut Due to Trade Agreement** - **Global Trend of Increased Investment and Employment Through Semiconductor and Automotive Cooperation** [Unblock Media] Jerome Powell, Chair of the U.S. Federal Reserve (FED), stated that a trade agreement could serve as a stepping stone for an interest rate cut. He explained that strengthened supply chain cooperation between the U.S., the European Union (EU), Japan, and South Korea in the semiconductor and automotive sectors could reduce corporate costs, positively affecting economic growth. Powell particularly highlighted the practical impacts of agreements related to semiconductors and electric vehicles on the economy. For instance, the advanced semiconductor Memorandum of Understanding (MOU) established in the first half of 2025 led to reduced tariffs and expanded tax benefits for research and development (R&D) expenses. As a result, global investments in semiconductors have risen, along with job creation. Furthermore, the agreement to eliminate tariffs on electric vehicles has enhanced the export competitiveness of U.S.-made vehicles, driving up sales among major automakers by 8% compared to the previous year. Meanwhile, an interest rate cut, which could weaken the value of the dollar, is expected to bring changes to the cryptocurrency market. For example, funds inflow into Bitcoin exchange-traded funds (ETFs) is anticipated to rise by 15% compared to last year, with trading volume on major exchanges potentially increasing by over 20%. However, Powell stressed that the final decision on interest rates would take into account a holistic review of various economic indicators, including inflation, employment, and international risks.