The Fed’s real message: Save the economy from Trump

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In the case of Donald Trump vs. the U.S. Federal Reserve, the president of the United States is likely to secure a winning verdict this week.

Central bank officials are expected to cut interest rates for the first time since the global financial crisis not because Trump demanded it. Instead, they will move in part because the president’s bruising trade policy has helped fuel a global manufacturing slowdown and injected deep uncertainty into executive suites around the world.

Fed Chairman Jerome Powell won’t directly say it directly after his meetings Tuesday and Wednesday. But the central bank will reverse course at least in part to save the Trump economy from Trump.

“There is just no question that Powell has been ‘Trumped’ here,” said Ed Yardeni, president and chief investment strategist of Yardeni Research Inc. “Just read Powell’s comments during his recent congressional testimony and trade comes up eight times in the context of weighing on the global economy. All Trump had to do was keep up geopolitical trade uncertainty for a while and he’d get the Fed to cut rates.”

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