CNBC Fed Survey: Trump's Fed Pressure Linked to Higher Inflation and Weaker Growth

CNBC Fed Survey Insights

• 📊 The latest CNBC Fed survey reveals significant disagreement among respondents regarding the appropriate course of action for the Federal Reserve.
• ⚠️ A strong majority (82%) believe President Trump is attempting to limit or eliminate Federal Reserve independence, with 41% stating his intention is to limit it and another 41% believing he aims to eliminate it entirely.

Economic Impact of Presidential Pressure

• 📈 68% of respondents predict that presidential actions concerning the Fed will lead to higher inflation.
• 📉 57% anticipate higher unemployment, and 54% foresee lower economic growth.
• 💸 A significant 74% believe these actions will result in a lower value of the US dollar.

Fed Meeting Expectations and Policy Disagreements

• 🎯 While 97% expect the Fed to cut rates by 25 basis points at the current meeting, only 41% believe this is the appropriate amount.
• ⚡ There's a notable division on policy, with 41% favoring a 25 basis point cut, 28% advocating for a 50 basis point cut, and another 28% suggesting no cut at all.
• 📊 Respondents' year-end 2025 funds rate projection is 3.6%, a decrease from July, indicating a belief that the Fed will reach its long-run rate relatively quickly.

Federal Reserve Independence and Leadership

• 🔒 An appeals court has cleared the way for Federal Reserve Governor Lisa Cook to remain on the Fed board, rejecting the administration's attempt to remove her.
• 🧑‍💼 The survey also indicates that 55% find CA chair Steven Myron's unpaid leave inappropriate.

Next Fed Chair Speculation

• 🔍 Among the 29 respondents, Chris Waller is the leading candidate to be the next Fed Chair, with 45% believing President Trump will name him.
• 📊 Other potential candidates mentioned include Worsh (24%), Hasset (17%), and Bullard (7%).
• 🌐 The process for selecting the next Fed Chair is described as transparent, with the Treasury Secretary aiming to add a few names to the president's existing list of familiar candidates.