"Wall Street Predicts Powell's Retirement: Futures Market Signals Fed Rate Cut in June"

# Wall Street Anticipates Rate Reductions Post-Jerome Powell's Term in May Wall Street analysts are predicting potential interest rate cuts once Jerome Powell’s term as Federal Reserve Chair concludes next May. Historically cautious in easing monetary policy, the Federal Reserve is expected to implement two or three rate reductions this year, with further cuts likely under new leadership. # Successor to Powell May Advocate for Aggressive Policy Changes Former President Donald Trump has openly pressured Powell for more aggressive rate cuts. It is widely anticipated that Powell's successor might act swiftly to implement these measures, aligning with Trump’s preferences. Market activity reflects increasing bets on these potential changes. Notably, trading volume has surged in SOFR futures contracts, focusing on simultaneous selling of March 2026 contracts and buying June 2026 contracts. This positioning indicates a belief in rate cuts occurring between these periods. Last Thursday, SOFR trading volume exceeded 60,000 contracts, marking the second-highest level in history. # Key Federal Reserve Meetings Under Scrutiny Powell’s final Federal Open Market Committee (FOMC) meeting is scheduled for April 28–29, 2024, followed by the next meeting on June 16–17. Market participants are closely monitoring the period immediately after Powell’s term, anticipating that the new Fed Chair may move decisively to lower rates. Trump has openly criticized Powell, stating in April that Powell’s “term ending is far too late.” Although Trump recently said he wouldn't remove Powell from office, he continues to pressure the Federal Reserve for rate cuts. Trump has also indicated plans to soon nominate Powell’s successor. # Overview of Recent Rate Policy The Federal Reserve rapidly raised interest rates throughout 2022 and 2023, with a cumulative increase of 425 basis points. By late last year, the Fed implemented three rate cuts, pausing to stabilize the federal funds rate in the 4.25%–4.5% range throughout 2024. These actions aligned with evolving labor market trends and inflation dynamics. According to a Bloomberg survey, economists predict incremental rate cuts—likely 25 basis points—this September and again in December. The Federal Reserve's March projections already suggested the possibility of two rate reductions by year-end. # Upcoming Fed Policy Update Looking ahead, the Federal Reserve’s next monetary policy meeting is slated for next Wednesday. While a rate hold is widely expected, markets are keenly awaiting updated economic forecasts and indications of how the appointment of a new Chair could influence future policy direction.