President Donald Trump’s recent comments against Federal Reserve Chair Jerome Powell are “noise,” says Katerina Simonetti, a senior executive at banking giant Morgan Stanley.
Simonetti, senior vice president and private wealth advisor at Morgan Stanley, downplayed Trump’s attacks on Powell during an interview with CNBC’s ‘Fast Money’.
According to Simonetti, this isn’t the first time Trump is slamming the Fed chair.
According to Simonetti, this isn’t the first time Trump has slammed the Fed chair. He did so in 2019 as well, at the time describing Powell as a “golfer who can’t putt.” The latest outburst comes amid Trump’s dissatisfaction with how the Federal Reserve under Powell has handled the issue of interest rates, criticizing the central bank chief as always being “too late.”
Despite inflation data showing a slowdown, stocks have remained largely negative though the past week. Powell, who Trump says will soon be gone, maintained he will not step down. ‘Mad Money’ host Jim Cramer told CNBC he sees Powell “stuck between a rock and a hard place.”
Earlier in the week the U.S. president posted on his Truth Social account that Powell’s “termination cannot come fast enough.” Trump has reportedly considered firing Powell via the U.S. Supreme Court.
Simonetti’s perspective is that Trump’s threats amount to “noise” that’s unlikely to have any immediate impact either on the markets or the Federal Reserve’s policy. According to her, it’s data—not political rhetoric—that dictates what the Fed does.
Recent tariffs, in her opinion, carry significant inflationary pressures that the Fed needs to analyze and factor into any decision. That is the course of action Powell is rightly focusing on before taking steps. Given this, Simonetti says she does not expect any rate cuts in 2025, and believes Powell will likely serve out the remainder of his term.
The Morgan Stanley exec’s comments come as markets have tanked amid negative investor reactions to tariffs and the trade war between China and the United States.
Notably, Trump bashed Powell for not cutting interest rates even as the European Central Bank cut its key deposit facility rate by another 25 basis points.
White House has pushed tariffs against China to 245% and seen risk asset markets plummet. Stocks sold-off sharply on Wednesday, and crypto mirrored the bloodbath with Bitcoin (BTC) falling below $80,000.
While Bitcoin has since bounced back above $85,000, downside pressure remains high. The U.S. stock market, meanwhile, closed lower on the week ahead of Good Friday.
